U.S. West Texas Intermediate crude oil futures are up late in the session on Thursday but off its intraday high. Prices have been supported throughout the session by a weaker U.S. Dollar and hopes for improved fuel demand in China after COVID-19 curbs were eased in two major cities.
At 21:25 GMT, January WTI crude oil futures are trading $81.38, up $0.83 or 1.03%. The United States Oil Fund ETF (USO) settled at $70.44, up $0.21 or +0.30%.
The prospect of a lower price cap on Russian oil is also lending support, analysts said. European Union governments tentatively agreed on Thursday on a $60 cap on Russian sea-borne oil, an EU diplomat said.
The wildcard is OPEC+, which holds a virtual meeting on Dec. 4 to discuss policy. Earlier in the week, there was a rumor that the group would announce another production cut. It drove prices sharply higher. However, that story was put to bed when officials decided to hold a Zoom meeting rather than an in person discussion.
Daily Swing Chart Technical Analysis
The main trend is down according to the daily swing chart. However, momentum is trending higher. A trade through $92.53 will change the main trend to up. A move through $73.60 will signal a resumption of the downtrend.
The minor trend is up. It changed to up when buyers took out $82.36. This shifted momentum to the upside.
On the downside, the nearest support is a long-term Fibonacci level at $78.72
On the upside, resistance is a 50% level at $83.07. This level stopped the rally on Thursday.
Daily Swing Chart Technical Forecast
Trader reaction to $83.07 is likely to set the early tone on Friday.
A sustained move under this level will signal the presence of sellers with $78.72 the nearest target.
A sustained move over $83.07 will indicate the presence of buyers. This could trigger a quick surge into a pivot at $84.43. This is a potential trigger point for an acceleration to the upside with $91.12 the next major target.
