Crude Oil Price Technical Forecast: WTI Rebound Jumps Into…
(MENAFN-DailyFX) Crude Oil Technical Forecast: WTI Weekly Trade Levels
- Crude Oil updated technical trading levels – weekly chart
- WTI bounces off support and attempts to confirm completion of August correction
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Crude oil prices broke a three-week losing streak, with WTI now up more than 12% from July lows. The focus is on this restoration of tech support and the battle lines are being drawn towards the August Open. These are the updated targets and invalidity levels of significance on the weekly oil price technical chart. Watch my latest strategy webinar for a detailed breakdown of this technical construction of crude oil prices and more.
Crude Oil Price Chart – WTI Weekly
Diagram created by Michael Boutros, Technical Strategist; Crude Oil (WTI) on Tradingview
Notes: In my most recent weekly Crude Oil Technical Forecast, we noted that the WTI correction is “now examining interest levels for possible support. A good zone from a trading perspective to reduce part of short exposures / lower protective stops…” Oil is up more than 5.7% this week to trade back above 100 ahead of Friday’s US close. Is this the low we’ve been looking for? It’s too early to tell and while there’s a risk of another washout we’ll be looking for confirmation heading into the August Open.
Focus is on this bounce off midline confluent support, with initial weekly resistance targeted at the 38.2% Fibonacci retracement of June’s decline at 103.19. Key resistance is seen at June high/61.8% retracement at 110.01-111 – a break/weekly close above this level would be needed to hint at a more significant low like the one registered this month/a possible resumption of the Uptrends on the border. Weekly support remains unchanged at 91.85, supported by broader bullish invalidation at 85.61-88.01 – a region set off by the 2013 low, the 100% extension of March’s decline and the 61.8% retracement of the rise in November is defined.
Conclusion: Entering the August open, the focus remains on confirming a potential exhaustion bottom below either of these levels in the coming weeks IF the broader multi-year oil uptrend is to remain sustainable. From a trading perspective, losses should be limited to the low close (~95) IF a major reversal is underway with a close above 111, which is ultimately needed to mark the resumption. However, remain nimble on the monthly/weekly opens – further probing uptrend support may present more favorable opportunities. Check out my latest Crude Oil Short-Term Technical Outlook for a closer look at WTI’s short-term technical trading levels.
For a full breakdown of Michael’s trading strategy, see his Fundamentals of Technical Analysis series on building a trading strategy
Crude Oil Traders Sentiment – WTI Price Chart
- A recap of IG client sentiment shows traders net long Crude Oil – the ratio is +1.44 (59.03% of traders long) – typically a mild bear market
- Long positions are 3.02% higher than yesterday and 3.47% lower than last week
- Short positions are 11.59% lower than yesterday and 0.09% higher than last week
- We usually view crowd sentiment as contrarian and the fact that traders are net long suggests that WTI prices could fall further. Traders are net-longer than yesterday but less net-long than last week. The combination of current positioning and recent changes gives us another mixed bias on crude oil trading from a sentiment perspective.
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— Written by Michael Boutros, Technical Strategist at DailyFX
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