WTI Crude Oil Technical Analysis and Short-Term Forecast
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December WTI crude oil is pulling back after testing and holding the 38 percent retracement of the decline from $71.47 and the 62 percent retracement from $65.77 at $62.0 on a closing basis. The move up from $55.96 was due for a correction, and today’s decline completed Friday’s shooting star by settling below last Thursday’s $60.9 midpoint. A daily bearish KCDpeak (overbought signal) was also confirmed, but this could prove to be a bullish signal because it formed so quickly.
That said, the confirmation point of the shooting star, the 38 percent retracement of the rise from $55.96, and the equal to (1.00) target of the intraday wave down from $62.59, all around $60.0, held on a closing basis. Therefore, the pullback from $62.59 might prove to be short-lived and is probably forming the corrective leg of a wave up from $55.96.
The outlook for tomorrow is bearish. Prices are already dropping below $60.0 during the post-settlement trading hours. Tests of $59.4 and $58.9, the respective intermediate (1.382) and larger than (1.618) targets of the intraday wave down from $62.59, are favored. Settling below $60.0 for a few days will strongly suggest that prices will begin to consolidate. This is the most probable scenario for the near-term. Key support is the 62 percent retracement from $55.96 at $58.5. Settling below $58.5 for a few days will imply that the move up is failing.
Nevertheless, as stated, because $60.0 was held on a closing basis today, there is still a reasonable chance for the move up to extend in the coming days. Settling above key near-term resistance at $62.0 will confirm the pullback from $62.59 is complete, putting the near-term odds in favor of $62.6 and a push to challenge the next major threshold at $63.7.
