Crude Oil Price Update – Trader Reaction to $49.07 Will Determine Strength of RallyThe main trend is up according to the daily swing chart. The uptrend was reaffirmed on Friday when buyers took out the March 3, 2020 top at $49.07.
U.S. West Texas Intermediate crude oil futures hit a nine-month high on Friday as investors continued to bet that the rollout of COVID19 vaccines would lead to an increase in demand sooner than previously expected. Meanwhile, traders seemed to shrug off the surge in coronavirus cases across the globe, and a possible stalemate in negotiations over fresh U.S. fiscal stimulus.
At 20:47 GMT, February WTI crude oil is trading $49.04, up $0.50 or +1.03%.
75% of retail CFD investors lose money
Pfizer has applied for approval in Japan for its vaccine, which is being used in the United Kingdom and the United States. Vice President Mike Pence said U.S. approval for Moderna’s shot could come later on Friday.
In other news, U.S. energy firms this week added oil and natural gas rigs for a fourth week in a row as producers keep returning to the wellpad with crude prices trading above $45 a barrel since late November.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. The uptrend was reaffirmed on Friday when buyers took out the March 3, 2020 top at $49.07.
Daily Swing Chart Technical Forecast
The next move will be determined by whether buyers can take out $49.07 with conviction.
Taking out a level with conviction essentially means “old tops become new bottoms”. It also means the market goes “bid” on the breakout.
If this level is taken out with conviction then it will indicate that new buyers are coming in and they aren’t afraid to buy strength. If the move continues to build then look for the rally to possibly extend into the February 20 main top at $53.60 over the near-term.
If buy stops rather than new buying triggered the breakout then the market could straddle $49.07 or even pullback 50% to 61.8% of the rally from $45.14 before another wave of buyers show up.
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