Crude Oil Short-term Outlook: Oil Spill Searches for Support
Crude oil prices plunged more than 8.5% off the highs with WTI now approaching make-or-break support. The levels that matter on the short-term technical charts.
Share this:
Crude Oil Technical Outlook: WTI Short-term Trade Levels
- Oil rally falters into yearly high- breaks multi-month uptrend support
- Crude price pullback now approaching key technical support- risk for exhaustion low
- WTI resistance 80.31, 81.35, 82.84-83.24- Support 76.00/75 (key), 74.25, 71.75
Crude oil prices plunged more than 5.7% off the weekly high with a break of uptrend support in WTI now approaching a make-or-break pivot zone. Battle lines drawn as we look for a low into the close of the month. These are the updated targets and invalidation levels that matter on the short-term WTI technical charts.
Review my latest Weekly Strategy Webinar for an in-depth breakdown of this crude oil setup and more. Join live on Monday’s at 8:30am EST.
Crude Oil Price Chart – WTI Daily
Chart Prepared by Michael Boutros, Technical Strategist; WTI on TradingView
Technical Outlook: In last month’s Crude Oil Short-term Outlook we noted that WTI was approaching the yearly open with, “A topside breach / close above 80.31 needed to fuel the next leg higher towards the yearly / April high-day close at 83.24 and the next major pivot zone near 85.61-86.56 – a region defined by the 2013 low and the 38.2% Fibonacci retracement of the 2022 decline.” Oil continued to rally into the August open with price registering an intraday high at 84.87 before exhausting. An outside-day reversal candle off the highs broke the June uptrend days later and the focus has been on this corrective pullback.
Crude prices have now plunged more than 8% off the high with WTI approaching the first major support hurdle near 76.50/75- a region defined by the 100% extension of the monthly decline (two-equal legs), the 38.2% retracement of the yearly range and the 2018 swing high. Note that the 200-day moving average rests just lower (~76) and the focus is on a reaction into this key zone IF reached.
Crude Oil Price Chart – WTI 240min
Chart Prepared by Michael Boutros, Technical Strategist; WTI on TradingView
Notes: A closer look at oil prices shows WTI trading within the confines of a descending pitchfork formation extending off the monthly highs. Initial resistance now eyed back at 80.31 with near-term bearish invalidation now lowered to the objective weekly open at 81.35. Ultimately, a breach / close above the April / August high-day closes at 82.84-83.24 is needed to fuel the next attempt at a breakout of the yearly opening-range.
The immediate focus is on the 76.50/75 support range – IF this pullback off the highs is corrective in nature, losses should be limited to the 200-day moving average. Weakness beyond this threshold would threaten / suggest a larger trend reversal may be underway towards 74.25 and beyond.
Bottom line: A break below multi-month uptrend is now approaching correction support – threat for downside exhaustion into the 200-DMA. From a trading standpoint, look to close short-exposure on a stretch towards 76 IF reached – losses should be limited to the lower parallel with a breach / close above the weekly open needed to alleviate further downside pressure. Review my latest Crude Oil Weekly Technical Forecast for a closer look at the longer-term WTI trade levels.
Active Short-term Technical Charts
- Gold Price Short-term Outlook: XAU/USD Searches Support Sub-1900
- US Dollar Short-term Outlook: USD Rally Set to Snap
- British Pound Short-Term Outlook: GBP/USD Breakout Imminent
- Euro Short-term Outlook: EUR/USD Poised for August Breakout
- Canadian Dollar Short-term Outlook: USD/CAD Set to Snap 2023
--- Written by Michael Boutros, Sr Technical Strategist with FOREX.com
Follow Michael on Twitter @MBForex
Related tags:
Open an account in minutes
Experience award-winning platforms with fast and secure execution, and enjoy tight spreads from 0.5 pts on FX and 0.3 pts on indices.
Economic calendar
Web Trader platform
Our sophisticated web-based platform is packed with features.
Related articles
USD/JPY falters, EUR/USD awaits French bond verdict
The yen has reacted to falling US yields, but the euro faces a different problem. Could French government bond yields provide the additional push needed to break EUR/USD's downtrend?
Gold Bears Approach Major Support, USD/CHF Eyes Reversal
Gold bears approach major support around $4,000, while USD/CHF shows signs of a bearish reversal. Middle East tensions add to market uncertainty.
US Dollar Short-term Outlook: USD Four-Week Rally Stalls Below Key Resistance 10 8 2026
DXY is holding in a tight range beneath major resistance as traders await the next catalyst from inflation expectations and Fed repricing.
This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.
StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.
In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.
StoneX Financial Pte. Ltd. is not under any obligation to update this report.
Trading CFDs carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit www.forex.com/en-sg/terms-and-policies for the complete Risk Disclosure Statement.