Crude Oil Price Update – Upside Momentum Could Drive Market into Major 50% Level at $59.63

U.S. West Texas Intermediate crude oil futures are trading higher, but inside Friday’s range. The chart pattern suggests investor indecision and impending volatility. Traders are dealing with the possibility of a balanced market with the OPEC-led production cuts and U.S. sanctions against Iran and Venezuela being offset by expectations of lower demand due to the slowing global economy.

At 12:42 GMT, May WTI crude oil futures are trading $59.00, up $0.18 or +0.31%.

Daily Technical Analysis

The main trend is up according to the daily swing chart. A trade through $59.25 will signal a resumption of the uptrend. The trend is safe for now, but due to the prolonged move up in terms of price and time, the market is still vulnerable to a closing price reversal top.

The short-term range is $54.87 to $59.25. If the selling pressure continues then its retracement zone at $57.06 to $56.54 will become the primary downside target.

Daily Technical Forecast

Bullish Scenario

If buyers retake control then look for a possible rally into Friday’s high at $59.25. Taking out this level could drive the May WTI crude oil futures contract into the major 50% level at $59.63. Be prepared for counter-trend sellers on the first test of this level. Overtaking it, however, could trigger an acceleration to the upside.

Bearish Scenario

If sellers continue to exert pressure then look for a break into the uptrending Gann angle at $57.87. Since the main trend is up, we could see buyers on the first test of this angle. Look for an acceleration to the downside if $57.87 fails as support. This could trigger a break into the short-term 50% to 61.8% retracement zone at $57.06 to $56.54.