Crude Oil Price Update – Way of Least Resistance is Down

March West Texas Intermediate crude oil futures are under pressure on Friday in reaction to the news of increased production from Iran. Traders also continue to react to increasing U.S. production, a firmer U.S. Dollar and stock market turmoil.

Daily Technical Analysis

The main trend is down according to the daily swing chart. The market is 11 days down from the $66.66 main top and five days down from the $66.30 main top. This puts us in the window of time for a possible closing price reversal bottom.

The main range is $56.07 to $66.66. Its retracement zone is $61.37 to $60.12. This zone is controlling the longer-term direction of the market.

Daily Technical Forecast

Based on the early price action, the direction of the WTI futures contract today will be determined by trader reaction to the Fibonacci level at $60.12.

A sustained move under $60.12 will indicate the presence of sellers. If selling volume increases on the move then we could see an acceleration to the downside with an uptrending Gann angle at $58.45 the next major target.

Holding $60.12 will signal the presence of buyers. However, the initial rally could be labored because of potential resistance at $60.82, $61.16, $61.30 and $61.37.

The trigger point for an acceleration to the upside is the 50% level at $61.37.