Crude Oil

Crude Oil Price Update – Trading on Bullish Side of Main Retracement Zone

Increasing concerns over supply are helping to drive U.S. West Texas Intermediate crude oil price higher on Thursday shortly before the regular session opening. Traders are responding to a storm in the Gulf of Mexico that is threatening crude output, escalating tensions in the Middle East could choke supply distribution in the region and shrinking U.S. stockpiles. Furthermore, the market crossed to the strong side of a key technical indicator which could lead to aggressive hedge fund buying.

At 08:48 GMT, September WTI crude oil futures are trading $60.81, up $0.29 or +0.48%.

WTI Crude Oil
Daily September WTI Crude Oil

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The main trend turned up when buyers took out the last swing top at $60.32. If this move creates enough upside momentum then look for buyers to possibly take a run at the May 20 main top at $64.02. A trade through $56.13 will change the main trend to down.

The main range is $65.92 to $50.91. Its retracement zone is $60.18 to $59.01. On Wednesday, the market closed on the strong side of this zone. This is helping to generate upside momentum. This zone is new support.

The intermediate range is $64.02 to $50.91. Its retracement zone at $59.01 to $57.47 is also support.

Daily Swing Chart Technical Forecast

Based on the early price action and the current price at $60.81, the direction of the September WTI crude oil futures market on Thursday is likely to be determined by trader reaction to the main Fibonacci level at $60.18.

Bullish Scenario

A sustained move over $60.18 will indicate the presence of buyers. If this move creates enough upside momentum then look for an acceleration to the upside. The daily chart indicates there is plenty of room to the upside with the next major targets main tops at $64.02 and $65.02.

Bearish Scenario

Falling back under $60.18 won’t change the trend to down, but it will signal the return of sellers. This could trigger a break into support levels at $59.01 and $58.41.


September WTI crude oil futures are also trading on the strong side of the 200-Day Moving Average at $59.17. This is a potentially bullish signal. The hedge funds tend to use this indicator for buy/sell signals. So watch for increasing buying volume.

Published by

James Hyerczyk

James A. Hyerczyk has worked as a fundamental and technical financial market analyst since 1982. His technical work features the pattern, price and time analysis techniques of W.D. Gann.