Crude Oil Price Update – Attempting to Cross to Bullish Side of Major 50% Level at $36.07
U.S. West Texas Intermediate crude oil futures are edging higher on Tuesday on reports that OPEC and its allies would agree to extend output cuts that have shored up prices, during a video conference likely to be held later this week.
Expectations are building that OPEC+ producers are considering extending their production cuts of 9.7 million barrels per day (bpd), equivalent to about 10% of global production, into July or August, at an online meeting likely to be held on June 4.
At 11:45 GMT, July WTI crude oil futures are trading $36.36, up $0.92 or +2.60%.
In other news, Russian oil and gas condensate production fell to 39.7 million tonnes (9.39 million barrels per day) in May, near its target under a deal within the OPEC+ group, Interfax news agency reported on Tuesday, citing energy ministry data. The figure was in line with data from sources, reported by Reuters on Monday, and down from 11.35 million barrels per day (bpd) in April.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. The uptrend was reaffirmed earlier today when buyers took out yesterday’s high. A trade through $31.14 will change the main trend to down.
The main range is $54.86 to $17.27. Its retracement zone at $36.07 to $40.50 is controlling the longer-term direction of the market. Traders are currently straddling the lower or 50% level of this range at $36.07.
Another potential upside target is the price gap at $37.64 to $41.88. It is actually surrounding the Fibonacci level at $40.50.
Daily Swing Chart Technical Forecast
Based on the early price action and the current price at $36.36, the direction of the July WTI crude oil futures contract the rest of the session on Tuesday is likely to be determined by trader reaction to the 50% level at $36.07.
Bullish Scenario
A sustained move over $36.07 will indicate the presence of buyers. If upside momentum continues to build over this level then look for an eventual test of the Fibonacci level at $40.50. This is a potential trigger point for an acceleration to the upside.
Bearish Scenario
A sustained move under $36.07 will signal the presence of sellers. The first downside target is a minor pivot at $33.83, followed by the main bottom at $31.14.
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This article was originally posted on FX Empire
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