Crude Oil Price Update – Trying to Build Support Base at $55.97 to $54.77

U.S. West Texas Intermediate crude oil futures are trading higher on Friday shortly after the regular session opening. The market is being underpinned by speculative buyers betting on an escalation of tensions in the Middle East. Gains are being capped by concerns over demand. Today’s U.S. Advance GDP report could move the market if it misses the mark.

At 12:30 GMT, September WTI crude oil futures are trading $56.37, up $0.35 or +0.64%.

Speculative buyers are hoping for a supply disruption to drive prices higher. Bullish traders are also hoping the GDP report comes in higher than the 1.8% estimate. This would help relieve some of the worries about demand.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, however, momentum is trending slightly higher. A trade through $54.85 will signal a resumption of the downtrend. The market is in no position to change the main trend to up, but there is room for a normal retracement.

The minor trend is up. This shifted momentum to the upside. A trade through $57.64 will indicate the buying is getting stronger. A move through $55.33 will change the minor trend to down. This will shift momentum to the downside.

The short-term range is $50.91 to $61.02. Its retracement zone at $55.97 to $54.77 is support. This zone helped produce a bottom at $54.85 last week and on Wednesday at $55.33.

The intermediate range is $64.02 to $50.91. Its retracement zone at $57.47 to $59.01 is resistance.

The main range is $65.92 to $50.91. Its retracement zone at $58.41 to $60.18 is additional resistance.

Daily Swing Chart Technical Forecast

Based on the early price action, the direction of the September WTI crude oil market on Friday is likely to be determined by trader reaction to the 50% level at $55.97.

Bullish Scenario

A sustained move over $55.97 will indicate the presence of buyers. If this move creates enough upside momentum then look for the rally to possibly extend into the intermediate 50% level at $57.47, followed closely by the minor top at $57.64.

Bearish Scenario

A sustained move under $55.97 will signal the presence of sellers. If this move generates enough downside momentum then look for a move into $55.33, followed by $54.85 and $54.77.