Crude oil forecast: oil spill searches support- WTI bears eye 70

Crude Oil technical forecast: WTI weekly trade levels

Crude reverses sharply off technical resistance- risk for exhaustion low in the weeks ahead
Oil bears attempting third weekly decline - now approaching key technical pivot zone
WTI resistance 82.68-83.28, ~87.23, 89.05- support ~69.19-71.47 (key), 65.92-66.57, 59.16

Crude oil plummeted from fresh yearly highs with WTI attempting a third consecutive weekly sell-off. The decline is now approaching a key pivot zone and we’re on the lookout for a possible exhaustion low in the days ahead- it’s make-or-break for the March rally. These are the updated targets and invalidation levels that matter on the oil weekly technical charts heading into May trade.

Discuss this crude oil setup and more in the Weekly Strategy Webinars on Monday’s at 8:30am EST.

Crude Oil Price Chart – WTI Weekly

Chart Prepared by Michael Boutros, Technical Strategist; WTI on TradingView

Technical Outlook: In last month’s Crude Oil price forecast we noted that WTI was approaching the yearly highs with, “with key resistance unchanged at median-line / 2021 high-week close at 83.28.” Oil briefly registered an intraweek high at 83.51 before reversing sharply with a two-week sell-ff plunging nearly 11.5%. The focus is on a key technical pivot zone just lower and we’re on the lookout for a possible exhaustion low into heading into May.

Key support rests at 69.19-71.51 – a region defined by the yearly low-week reversal close, the 2022 low-week close, and the 61.8% Fibonacci retracement of the objective yearly range. Ultimately, a break / weekly close below the August 2018 low-week close / 2019 high at 65.92-66.57 is needed to mark resumption of the broader downtrend with such a scenario exposing the 2020 high-week close at 59.16.

Key resistance now eyed at the 2023/2021 high-week closes at 82.68-83.28 – a breach / weekly close above this threshold is needed to validate a breach of the median-line / yearly opening-range. Subsequent resistance objectives eyed at the 52-week moving average (currently ~87.23) and the 38.2% retracement of the 2022 decline at 89.05- look for a larger reaction there IF reached.

Bottom line: A turn from downtrend resistance is now approaching downtrend support. From a trading standpoint, losses should be limited by 69.19 IF price is indeed heading higher with a breach / close above 83.28 still needed to suggest a larger trend reversal is underway. I’ll publish an updated crude oil short-term outlook once we get further clarity on the near-term WTI technical trade levels.

Active Weekly Technical Charts

--- Written by Michael Boutros, Sr Technical Strategist with FOREX.com

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