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Crude Oil Price Update – Daily Trend Changes to Up on Trade Through $54.99

James Hyerczyk

U.S. West Texas Intermediate crude oil futures are trading sharply higher late Tuesday after President Trump said he would hold an extensive meeting with Chinese President Xi Jinping at the G-20 summit in Japan later this month.

“Had a very good telephone conversation with President Xi of China. We will be having an extended meeting next week at the G-20 in Japan. Our respective teams will begin talks prior to our meeting,” Trump tweeted.

Some traders are treating the news as a rumor since China has not confirmed a meeting would take place. It they do confirm then the market could extend its stellar gains.

Later today, traders will get a chance to react to the latest weekly inventories report from the American Petroleum Institute. Traders are looking for a 1.5 million barrel draw down.

At 17:07 GMT, August WTI crude oil futures are trading $53.94, up $1.77 or +3.41%.

Daily August WTI Crude Oil

Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through $54.99 will change the main trend to up. A move through $50.98 and $50.79 will signal a resumption of the downtrend.

The short-term range is $50.79 to $54.99. Its retracement zone at $52.89 to $52.39 is controlling the direction of the market. This zone is new support.

The main range is $64.03 to $50.79. If the trend changes to up then its retracement zone at $57.41 to $58.97 will become the primary upside target.

Daily Technical Forecast

Based on the early price action and the current price at $53.94, the direction of the August WTI crude oil futures contract the rest of the session is likely to be determined by trader reaction to the downtrending Gann angle at $54.03.

Bullish Scenario

A sustained move over $54.03 will indicate the presence of buyers. If this move generates enough upside momentum then look for a possible test of the main top at $54.99. Taking out this level will change the main trend to up. This could trigger an eventual rally into the 50% level at $57.41.

Bearish Scenario

A sustained move under $54.03 will signal the presence of sellers. This could lead to a labored break into a series of potential support levels at $53.04, $52.89, $52.39 and $51.92.

Overview

The current set up indicates two breakouts to the upside are possible if buyers come in strong. The first breakout price is $54.03, followed by $54.99.

This article was originally posted on FX Empire

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