U.S. West Texas Intermediate crude oil futures are inching higher into the close, recovering from early session weakness. Traders are now awaiting the release of the American Petroleum Institute’s weekly inventories report.
Earlier in the session, prices were under pressure after a report showed record Saudi production, however, the market turned around as investors expressed optimism over a possible production cut deal at OPEC’s December 6 meeting in Vienna. Short-sellers also trimmed positions ahead of this weekend’s G20 summit on speculation the U.S and China may make progress on trade issues.
At 2125 GMT, January WTI crude oil futures are trading $51.89, up $0.26 or +0.50%.
Daily Swing Chart Technical Analysis
The main trend is down according to the daily swing chart. A trade through $50.10 will signal a resumption of the downtrend. It is currently straddling former bottoms at $51.17 and $50.16. If $50.10 fails, then $49.85 becomes the next target. This is a potential trigger point for an acceleration into $47.96.
The minor trend is also down, but the market did form a new minor bottom at $50.10. This is the first minor bottom since November 12.
The nearest upside resistance is a Fibonacci level at $54.79.
Daily Swing Chart Technical Forecast
Based on Tuesday’s price action, the direction into the close is likely to be determined by trader reaction to the former bottom at $51.17.
A sustained move over $51.17 will indicate the presence of buyers. If this move generates enough upside momentum, we could see a surge into $54.79 over the near-term.
A sustained move under $51.17 will signal the presence of sellers. The main targets are a price cluster at $50.16, $50.10 and $49.85.
The September 11, 2017 main bottom at $49.85 is the trigger point for a steep plunge with the August 16, 2017 main bottom at $47.96 the next major target.