Crude Oil Price Update – Trying to Breakout of Near-Term Retracement Zone at $68.05 to $69.15

U.S. West Texas Intermediate crude oil futures are trading higher shortly after the regular session opening on Monday. The market was under pressure earlier in the session after investors digested Friday’s decision by OPEC to increase production.

At 1205 GMT, August WTI crude oil is trading $68.98, up $0.40 or +0.57%.

Daily Technical Analysis

The main trend is up according to the daily swing chart. It turned up on Friday when buyers took out $67.03.

The short-term range is $72.70 to $63.40. Its retracement zone at $68.05 to $69.15 is currently being tested. Trader reaction to this zone should determine the market’s direction today.

The market is also trading inside a major retracement zone bounded by a 50% level at $64.67 and a 61.8% level at $70.51. Trader reaction to this zone will determine the longer-term direction of the market.

Daily Technical Forecast

Based on the early trade, the direction of the August WTI crude oil market the rest of the session is likely to be determined by trader reaction to the short-term Fib level at $69.15.

Overtaking and sustaining a rally over $69.15 will indicate the buying is getting stronger. This could drive the market into the downtrending Gann angle at $69.83.

We could see some resistance at $69.83, but overcoming it could trigger a surge into the major Fib at 70.51, followed by the downtrending Gann angle at $71.26. This is the last potential resistance angle before the $72.70 main top.

The inability to sustain a rally over $69.15 will indicate the return of sellers. This could pressure the market back to an uptrending Gann angle at $68.40, followed by the 50% level at $68.05.

The daily chart will open up to the downside if $68.05 fails as support. If this move generates enough downside momentum then look for a break into the next uptrending Gann angle at $65.90.

Basically, look for the upside bias to continue on a sustained move over $69.15, and for a downside bias to develop on a sustained move under $68.05.