April WTI Crude Forming Closing Price Reversal Top

U.S. West Texas Intermediate crude oil futures are trading lower on Monday after testing its highest level in more than seven years earlier in the session. Traders may be taking profits after Reuters reported that Ukraine hinted at possible concessions to Russia that could alleviate tensions between the two countries that Western governments say are on the brink of war.

At 13:57 GMT, April WTI crude oil futures are at $91.21, down $0.21 or -0.23%. On Friday, the United States Oil Fund ETF (USO) settled at $65.75, up $1.79 or +2.80%.

Earlier in the session, prices rose over 1% in reaction to comments from the United States on Sunday about an imminent attack by Russia on Ukraine. Russia could invade Ukraine at any time and might create a surprise pretext for an attack, according to U.S. officials.

However, the markets cooled on Monday as Ukrainian Ambassador Vadym Prystaiko said Ukraine was prepared to make some concessions to Russia.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through 93.10 will signal a resumption of the uptrend. A move through 84.92 will change the main trend to down.

The minor trend is also up. A trade through $87.07 will change the minor trend to down. This will shift momentum to the downside.

The market is currently straddling a long-term Fibonacci level at $90.74.

The first minor support pivot is $90.09, followed by a second support pivot at $89.01. The short-term support zone is $87.08 to $85.66.

Daily Swing Chart Technical Forecast

The direction of the April WTI crude oil futures contract on Monday is likely to be determined by trader reaction to $91.42.

Bullish Scenario

A sustained move over $91.42 will indicate the presence of buyers. The first upside target is a minor pivot at $91.78. Overcoming this level could trigger a rally into the intraday high at $93.10.

Bearish Scenario

A sustained move under $91.42 will signal the presence of sellers. The first downside target is $90.74. Taking out this level could trigger a further break into the first pivot at $90.09.

Buyers could come in on the first test of $90.09, but if it fails then look for the selling to possibly extend into the second pivot at $89.01.

Side Notes

A close under $91.42 will form a potentially bearish closing price reversal top. If confirmed, this move could trigger the start of a 2 to 3 day correction.