Crude Oil Price Update – Weakens Under $73.08 Pivot with $71.96 Next Target, Followed by $70.33

U.S. West Texas Intermediate crude oil futures are trading lower on Monday as concerns about slowing global growth outweighed the prospect of tightening supply after talks among key producers to raise output in coming months hit an impasse and amid renewed worries over another potential surge in COVID-19 infections.

At 13:44 GMT, September WTI crude oil is trading $72.74, down 1.07 or -1.45%.

“Traders are now refocusing on the spread of the COVID-19 pandemic and global concerns over the new variants’ expansion are weighing on prices, despite tightening oil supplies globally,” Rystad Energy analyst Louise Dickson said.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through $70.10 will signal a resumption of the downtrend. A move through $76.07 will change the main trend to up.

The first minor range is $76.07 to $70.10. Its retracement zone at $73.08 to $73.79 is resistance. This area helped stop the rally earlier today when prices hit $74.15. With the main trend down, sellers returned in an attempt to form a potentially bearish secondary lower top.

The first downside target is a 50% level at $71.96, followed by $70.33 and a retracement zone at $68.57 to $66.79.

Daily Swing Chart Technical Forecast

The direction of the September WTI crude oil market on Monday is likely to be determined by trader reaction to $73.08 and $73.79.

Bearish Scenario

A sustained move under $73.08 will indicate the presence of sellers. If this move creates enough downside momentum then look for the selling to possibly extend into $71.96. This is a potential trigger point for an acceleration into $70.33 to $70.10.

Bullish Scenario

Holding above $73.08 will be the first sign of counter-trend buyers. Taking out the Fibonacci level at $73.79 then the intraday high at $74.15 will indicate the buying is getting stronger. This could trigger an acceleration to the upside with the contract high at $76.07 the next major upside target.