WTI Crude Oil Price Action Suggests Investor Indecision

U.S. West Texas Intermediate crude oil futures are trading lower while posting an inside move late Thursday. The price action suggests investor indecision and impending volatility.

The indecision is being fueled by the tug of war between the bearish traders who are hoping for Iranian sanction relief and the bullish traders betting on an escalation of tensions between Russia and Ukraine.

At 18:05 GMT, April WTI crude oil is trading $89.39, down $2.44 or -2.66%. The United States Oil Fund ETF (USO) is at $63.72, up $0.18 or +0.28%.

On the bearish side, talks to resurrect a nuclear deal with Iran entered their final stages which could unlock more crude supplies. On the bullish side, losses were limited by heightened tensions between top energy exporter Russia and the West over Ukraine.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through $93.83 will signal a resumption of the uptrend. A move through $84.92 will change the main trend to down.

The market is currently trading between a pair of minor pivots at $89.01 and $90.09.

On the upside, the resistance is a long-term Fibonacci level at $90.74. On the downside, support is a retracement zone at $87.08 to $85.66.

Daily Swing Chart Technical Forecast

The direction of the April WTI crude oil market into the close on Thursday is likely to be determined by trader reaction to the pivot at $89.01.

Bearish Scenario

A sustained move under $89.01 will indicate the presence of sellers. This could lead to a labored break with potential buyers coming in on a test of the minor bottoms at $87.79 and $87.07. These levels are followed by the retracement zone at $87.08 to $85.66. The latter is the last potential support before the main bottom at $84.92.

Bullish Scenario

A sustained move over $89.01 will signal the presence of buyers. The first two targets are $90.09 and $90.74.

The Fibonacci level at $90.74 is a potential trigger point for an acceleration to the upside with $93.83 the next target. This is a potential trigger point for an acceleration to the downside.