Crude Oil Price Update – Uptrend Reaffirmed with $116.43 Next Major Target

U.S. West Texas Intermediate crude oil futures are soaring late in the session on Monday after confirming its uptrend by taking out a pair of main tops at $109.77 and $110.07. The move puts the market within striking distance of its March 7 top at $116.43. The nearby futures contract hit a high of $130.50 at the same time.

The rally was fueled by optimism that China would see significant demand recovery after positive signs the coronavirus pandemic was receding in the hardest-hit areas. Bullish traders were also betting on European officials to make a decision about a Russian oil embargo, which would affect supply.

Finally, U.S. gasoline futures set an all-time high again on Monday as falling stockpiles fueled supply concerns.

At 20:45 GMT, July WTI crude oil was trading $111.84, up $3.21 or +2.95%. On Wall Street, the United States Oil Fund ETF (USO) settled at $83.11, up $1.83 or +2.25%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through the intraday high at $112.47 will signal a resumption of the uptrend. A move through $116.43 will reaffirm the uptrend. Taking out $96.93 will change the main trend to down.

The short-term range is $116.43 to $88.53. The market is currently trading on the strong side of its retracement zone at $105.77 to $102.48, making it support.

Daily Swing Chart Technical Forecast

The direction of the July WTI crude oil market late in the session on Monday will be determined by trader reaction to $108.63.

Bullish Scenario

A sustained move over $108.63 will signal the presence of buyers. Taking out $112.47 will indicate the buying is getting stronger. If this generates enough upside momentum then look for a surge into the March 7 top at $116.43.

Bearish Scenario

A sustained move under $108.63 will indicate the presence of sellers. This could trigger a break back into the short-term Fibonacci level at $105.77. If this fails then look for the selling to possibly extend into the short-term 50% level at $102.48.

Side Notes

Look for a bullish tone in the market as long as July WTI crude oil holds above $102.48.