Crude Oil Price Update – Main Trend Changed to Up, but Traders Aren’t Chasing

U.S. West Texas Intermediate crude oil futures are inching higher early Thursday as traders prepare for the release of the government’s weekly inventories report at 16:00 GMT.

The market looked promising the previous session as crude oil prices advanced their weekly rally on hopes of potential COVID-19 vaccines and economic revival. Prices also rose above a two-month high on a surprise drawdown in U.S. crude stockpiles, according to the American Petroleum Institute (API).

The rally fizzled, however, after OPEC said global oil demand will rebound more slowly in 2021 than previously thought because of rising coronavirus cases.

At 02:05 GMT, December WTI crude oil futures are at $41.69, up $0.24 or +0.58%.

At 16:00 GMT, the U.S. Energy Information Administration (EIA) will release its weekly inventories report. It is expected to show a 2.0 million barrel drawdown in crude oil. The report was delayed a day because of Tuesday’s U.S. Veteran’s Day observance.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through $43.06 will signal a resumption of the uptrend. This would put the crude oil market on course to challenge the August 26 main top at $44.33.

The minor trend is also up. A trade through $37.06 will change the minor trend to down. This will also shift momentum to the downside.

The main range is $44.33 to $33.64. The market is trading on the strong side of its retracement zone at $40.25 to $38.99, putting it in a bullish position. This area is also support.

The short-term range is $33.64 to $43.06. Its retracement zone at $38.35 to $37.24 is potential support.

Daily Swing Chart Technical Forecast

With Wednesday’s change in trend to up, the market has increased the upside momentum.

Taking out $43.06 will indicate the buying is getting stronger with $44.33 the next likely upside target.

A sustained move under yesterday’s low at $41.32 will signal the presence of sellers. This could trigger an extension of the break into the main Fibonacci level at $40.25.

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