Crude Oil Price Update – Weekly Minor Trend Changes to Up on Trade Through $54.98

U.S. West Texas Intermediate crude oil finished at its highest level since December 4 last week. Providing the initial support was a report showing OPEC and other major producers had begun cutting output in December, a month before the cuts were scheduled to start on January 1. Later in the week, a rally was fueled by reports that the United States and China had offered concessions in an effort to speed up the process of ending the on-going trade dispute.

Last week, March WTI crude oil settled at $54.04, up $2.13 or +4.10%.

Weekly Technical Analysis

The main trend is down according to the weekly swing chart. A trade through $42.67 will signal a resumption of the downtrend. The market has a long way to go before changing the trend to up since the nearest main top comes in at $76.29.

The minor trend is also down. A trade through $54.98 will change the minor trend to up. This will also shift momentum to the upside.

The main range is $76.29 to $42.67. If the minor trend changes to up then its retracement zone at $59.48 to $63.45 will become the primary upside target.

The new minor range is $42.67 to $54.14. If there is a short-term pullback then look for a move into its retracement zone at $48.41 to $47.05.

Weekly Technical Forecast

The direction of the March WTI crude oil market this week is likely to be determined by trader reaction to the minor top at $54.98.

Bullish Scenario

A trade through $54.98 will change the minor trend to up. If this move cerates enough upside momentum then look for the rally to possibly extend into the main 50% level at $59.48. This is followed by a downtrending Gann angle at $60.29. Since the main trend is down, look for sellers on the first test of this area. However, taking out $60.29 could trigger an acceleration to the upside with the next target the main Fibonacci level at $63.45.

 Bearish Scenario

The inability to overcome $54.98, or a sustained move under this level will signal the presence of sellers. If this creates enough downside momentum then look for the selling to extend into the steep uptrending Gann angle at $50.67. Counter-trend buyers could come in on the first test of this angle, but if it fails then look for the selling to extend into the short-term retracement zone at $48.41 to $47.05.