Crude Oil Price Update - Testing First Retracement Zone Target at $39.48 - $40.08 - FX Empire

U.S. West Texas Intermediate crude oil futures are trading higher on Monday, lifted by comments from doctors for U.S. President Donald Trump suggesting he could be discharged from hospital as soon as Monday afternoon, just a few days after his positive coronavirus test sparked a steep sell-off.

At 14:29 GMT, December WTI crude oil futures are trading $39.32, up $1.98 or +5.30%.

Oil was also supported by an escalating workers’ strike in Norway. Energy Equinor shut four of its offshore oil and gas fields on Monday as its workers expanded their strike, a company spokesman told Reuters.

Traders also remain optimistic about a stimulus package after Friday’s weak September jobs report, highlighted the urgency for further coronavirus stimulus after a months-long stalemate in Washington.

Daily December WTI Crude Oil

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through $36.93 will signal a resumption of the downtrend. The main trend will change to up on a move through $42.02.

The minor range is $42.02 to $36.93. Its retracement zone at $39.48 to $40.08 is the first upside target. Since the trend is down, sellers could come in on the first test of this area.

The short-term range is $44.33 to $36.93. Its retracement zone at $40.63 to $41.50 is the second retracement zone target. This is the last potential resistance before the $42.02 main top.

Daily Swing Chart Technical Forecast

Based on the early price action, the direction of the December WTI crude oil futures contract the rest of the session on Monday is likely to be determined by trader reaction to the minor 50% level at $39.48.

Bullish Scenario

A sustained move over $39.48 will indicate the buying is getting stronger. This could trigger a further rally into the minor Fibonacci level at $40.08. Overtaking this level could lead for a further rally into the short-term 50% level at $40.63.

Bearish Scenario

A sustained move under $39.48 will signal the presence of sellers. This could trigger an intraday pullback into a minor pivot at $38.25. If this price fails then look for the selling to possibly extend into the minor bottom at $36.93.

For a look at all of today’s economic events, check out our economic calendar.


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