Crude Oil Technical Forecast: Oil Prices Buoyed by Technical Levels

CRUDE OIL TECHNICAL OUTLOOK: NEUTRAL

  • Oil prices bounce off psychological support after steady decline
  • US Crude (WTI) rebounds off $80.00 but the formation of a doji candle highlights indecision
  • Brent Crude falls below $90 with Fibonacci levels from the 2020 – 2022 move providing longer term support at around $77.5.

Crude Oil prices are currently trading at key technical levels that will likely continue to contribute to both the short and longer-term move.

With both WTI and Brent Crude futures recently rebounding off critical support, the downward trajectory pertaining to energy prices has reached a critical juncture that may jeopardize the imminent move.

After three consecutive months of losses, a bounce off $80.00 allowed US Crude (WTI) to trade higher before peaking at $87.20.

With the $90.00 psychological level providing additional resistance for the upward move, the formation of a doji candle on the weekly timeframe highlights an important zone that may keep both bulls and bears in check. With the downward trajectory still intact, a break below $80.00 may fuel bearish momentum that could lead to a move back towards the January low of $74.27.

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US CRUDE OIL (WTI) FUTURES WEEKLY CHART

Chart prepared by Tammy Da Costa using TradingView

With Fibonacci levels providing additional layers of support and resistance, a move below $74.27 could see the next level of support holding at the 61.8% retracement of the 2020 – 2022 move at $65.25.

US CRUDE (WTI) DAILY CHART

Chart prepared by Tammy Da Costa using TradingView

Similarly, Brent Crude Futures are looking to rise back above $90.00 with the next zone of resistance formed by the 38.2% retracement of the 2020- 2022 move at $92.09. Failure to rise back above $90 could see bears driving prices back below $85 opening the door for the 50% retracement of the same move at $77.56.

BRENT CRUDE FUTURES DAILY CHART

Chart prepared by Tammy Da Costa using TradingView