Crude Oil Price Update – Near-Term Strength Could Build Over $57.36 to $56.08 Retracement Zone
U.S. West Texas Intermediate crude oil futures are trading slightly better early Thursday after an industry reported showed a fall in U.S. crude stockpiles last week. The market also remains underpinned by positive comments by Federal Reserve Chairman Jerome Powell.
Helping to cap gains are a report that showed China’s industrial output grew significantly slower than expected in October, as weakness in global and domestic demand and the drawn-out Sino-U.S. trade war weighed on activity in the world’s second-largest economy.
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At 03:37 GMT, January WTI crude oil is trading $57.49, up $0.29 or +0.51%.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. A trade through $57.87 will signal a resumption of the uptrend. The main trend will change to down on a trade through $55.77.
The minor trend is also up. A trade through $56.27 will change the minor trend to down. This will also shift momentum to the downside.
The main range is $61.48 to $50.69. Its retracement zone at $57.36 to $56.08 is controlling the near-term direction of the market.
The short-term range is $53.84 to $57.87. Its retracement zone at $55.86 to $55.38 is additional support.
Daily Swing Chart Technical Analysis
Based on the early price action and the current price at $57.49, the direction of the January WTI crude oil market the rest of the session on Thursday is likely to be determined by trader reaction to the main Fibonacci level at $57.36.
Bullish Scenario
A sustained move over $57.36 will indicate the presence of buyers. If this move can create enough upside momentum then look for the rally to possibly extend into the last main top at $57.87.
Taking out $57.87 will reaffirm the uptrend. This could trigger an acceleration into the next main top at $58.64.
Bearish Scenario
A sustained move under $57.36 will signal the presence of sellers. This is a dangerous area for long traders because the nearest support is clustered at $56.27, $56.08, $55.86 and $55.77.