Holds above 20-day moving average support
The 20-day moving average is at 77.77. If crude oil closes above this line today, the upside objective will likely be reached. A move above today’s high will generate a signal for the continuation of the bullish trend. A test of the 200-day moving average at 79.96 appears to be a likely upside for this move. There is a potential area of low resistance near the trendline on the chart. Additionally, note the 78.6% Fib retracement at 79.23. A move above the 61.8% price objective will likely result in a reach at the 78.6% price zone. The price level will be confirmed by the swing high of January 29th.
Bullish weekly reversal occurs
A retracement may have been completed at last week’s low of 72.73. However, Crude Oil is still in a downtrend and may test lower price levels if resistance falls again. However, the weekly chart also shows an improving short-term bullish environment. On Monday, Crude Oil surpassed last week’s high of 77.81, triggering a bullish weekly reversal. On Monday, it closed above the high, confirming the upside.
A drop below 77.39 would suggest a deeper retracement
A deeper pullback before testing higher resistance would be signaled below today’s low of 77.39. The previous weekly support level is at 76.60, with the 38.2% Fib retracement just below at 76.31, followed by the 50% retracement at 75.62. Also note the small downward trend line crossing the bottom of the most recent consolidation period. This was an extension formation. It can be used as a guide if the price approaches the range.
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