Crude Oil Price Update – Attempting to Stabilize after Wednesday’s Steep Plunge

U.S. West Texas Intermediate crude oil futures are inching higher on Thursday after plunging the previous session. The market is being supported by OPEC+’s decision to roll over an output cut and a weaker U.S. Dollar.

Bargain-hunters may be stepping in after the benchmark sunk more than 3% on Wednesday after government data showed big builds in crude and oil products inventory.

At 08:55 GMT, March WTI crude oil is trading at $76.54, up $0.13 or +0.17%. On Wednesday, the United States Oil Fund ETF (USO) settled at $67.36, down $1.96 or -2.83%.

An OPEC+ panel endorsed the oil producer group’s current output policy at a meeting on Wednesday, leaving production cuts agreed last year in place amid hopes of higher Chinese demand and uncertain prospects for Russian supply.

Meanwhile, the U.S. Dollar fell after traders saw a dovish takeaway from Jerome Powell’s acknowledgement of progress in the ‘disinflationary process’ and that he is not worried about loosening financial conditions. A weaker dollar tends to drive up foreign demand for the dollar-denominated commodity.

Finally, oil prices plunged after U.S. government data showed big builds in crude oil, gasoline and distillate inventories.

Daily March WTI Crude Oil Technical Analysis

The main trend is up according to the daily swing chart. However, momentum is trending lower. A trade through $82.66 will reaffirm the uptrend. A move through $72.74 will change the main trend to down.

The minor trend is down. This is controlling the momentum. A trade through $79.73 will change the minor trend to up.

The short-term range is $70.56 to $82.66. The market is currently testing its retracement zone at $76.61 to $75.18. This area stopped the selling at $76.05 on Wednesday.

On the upside, the nearest resistance is a pivot at $77.70, followed by a major retracement zone at $80.23 to $82.51.

Daily March WTI Crude Oil Technical Forecast

Trader reaction to the short-term pivot at $76.61 is likely to determine the direction of the March WTI crude oil market on Thursday.

Bearish Scenario

A sustained move under $76.61 will indicate the presence of sellers. The first target is a short-term Fibonacci level at $75.18.

Watch for a technical bounce on the first test of $75.18, but if it fails then look for a possible acceleration to the downside with $72.74 the next likely target.

Bullish Scenario

A sustained move over $76.61 will signal the presence of buyers. The first upside target is a 50% level at $77.70. This is a potential trigger point for an acceleration into the minor top at $79.73, followed by the major resistance area at $80.23 – $82.51.