Crude oil price forecast: WTI bulls eye breakout at 2023 range high

Crude Oil technical forecast: WTI weekly trade levels

Crude rebounds sharply off technical downtrend support
Three-week rally now eyeing resistance at yearly range-highs
WTI resistance 83.28, 88.84-89.05 (major), 94 - support ~75, 71.47 (key) 65.92-66.57

Crude oil has rallied for the past three-weeks with a rebound off technical support now challenging the objective yearly opening-range highs. Is a low in place for WTI? These are the updated targets and invalidation levels that matter on the oil weekly technical chart.

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 had, “plummeted into downtrend support and we’re looking for a reaction down here- watch the weekly close for guidance.” Price held above confluent support that week at the August 2018 low-week close / 2019 high at 65.92-66.57 with a three-week rally surging more than 27% off the yearly low.

The advance is testing initial resistance this week at the November trendline (red) with key resistance unchanged at median-line / 2021 high-week close at 83.28. A breach / weekly close above this threshold would be needed to suggest amore significant low was registered last month with such a scenario exposing the 52-week moving average / 38.2% Fibonacci retracement of the 2022 decline at 88.84-89.05- look for a larger reaction there IF reached.

Weekly support now rests back with the December consolidation slope (currently ~75) backed by the 2022 low-week close at 71.47- losses should be limited to this threshold IF price is heading higher on this stretch. Note that losses below 65.92 could fuel another accelerated sell-off with such a scenario exposing the 2020 high-week close near the 59-handle.

Bottom line: Oil prices have rebounded sharply off downtrend support with the rally now approaching the objective yearly opening-range highs. From a trading standpoint, a good zone to reduce portions of long-exposure / raise protective stops – ultimately a breach / close above 83.28 is 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

Follow Michael on Twitter @MBForex

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