WTI Crude Oil Technical Analysis and Short-Term Forecast
The outlook for WTI crude oil remains bearish based on the aggressive decline from $76.07. However, the move down stalled just below the $65.2 larger than (1.618) target of the primary wave down from $76.07 today. Currently, the decline looks like a three-wave correction, but there is a good chance that resistance at $69.0 will hold and the decline could transmute into a five-wave trend that targets $59.5 and possibly $58.4. Such a deep test of support is unlikely without more bearish help from external factors. Nonetheless, falling below $66.0 will call for a test of $65.3 and likely $64.1 during the next few days. Settling below $64.1 would imply that the move down is a five-wave trend and increase odds for a test of targets below $60.0.
With that said, today’s move up from $65.01 helped shape a daily bullish hammer. This is a reversal pattern that warns the corrective move down might already be complete. To complete the hammer WTI must close above $69.0. The connection to $69.0 is made through $68.1, which is the smaller than (0.618) target of the intra-day wave up from $65.01. Settling above $69.0 would then call for a test of the hammer’s $71.1 confirmation point. Closing above this would strongly suggest the move down is complete and call for $71.9 and higher.
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