Crude Oil Price Update – Trader Reaction to $57.07 Will Determine Direction Today

February West Texas Intermediate crude oil futures are trading higher on Friday, continuing the recovery that began on Thursday.

Daily Technical Analysis

The main trend is down according to the daily swing chart, however, aggressive counter-trend buyers may be trying to form a secondary higher bottom at $56.11. The main trend will change to up on a trade through $58.60, but the market will still have to take out tops at $58.90 and $58.99 to sustain the breakout move.

The range we are working in is $55.15 to $58.99. Its 50% level or pivot is $57.07. Holding above this price will give it an upside bias.

The short-term range is $58.60 to $56.11. Its retracement zone at $57.36 to $57.65 is the next key area. This area was tested earlier today and rejected by sellers. This could be expected because the main trend is down. They are going to try to form a secondary lower top. Overcoming $57.65 will indicate the buying is getting stronger.

Daily Technical Forecast

Based on the early trade, the direction of the crude oil market today will be determined by trader reaction to the pivot at $57.07.

A sustained move over $57.07 will indicate the presence of buyers. This could trigger a retest of the short-term 50% level at $57.36. Overtaking this level will indicate the buying is getting stronger. This could lead to a test of the short-term Fibonacci level at $57.65. Crossing to the strong side of this price will shift the momentum to the upside.

A sustained move under $57.07 will signal the presence of sellers. This will also put the market on the bearish side of a steep downtrending angle at $57.10. This move could trigger the start of a steep break since the next target is this week’s low at $56.11.