Above 2,681 indicates a bullish reversal
As of this writing, a decisive move above today's high of 2,681 would trigger a bullish reversal. Some technical damage has occurred during the current decline as support failed first at the 20-day moving average and then at the 50-day moving average. This was followed by a monthly bearish reversal in the October price range below the daily swing low of 2,602, which was also the monthly low.
All of these indicators point to potential resistance levels on the way up, assuming today's lows hold. If this is not the case and we break below today's lows, we believe crude oil will likely move closer to the $2,484 to $2,473 support zone. The top level is the previous resistance top followed by the 61.8% Fibonacci retracement level.
Temporary decline below the 20-week moving average
It is also interesting to note that today's decline briefly pushed oil prices below the 20-week moving average (not shown) at 2,556. The 20-week moving average has held support almost 100% of the time since recovering the week of October 16th. This provides further evidence for today's potential lows, at least temporarily. And it has proven to be a viable trend indicator and should continue to be so. This means a decline below today's lows would provide further confirmation of the long-term weekly moving average breakdown.
Must be greater than 2,619
For crude oil to have a chance of rising, it needs to rise above Wednesday's high of 2,619 and hold there. Since we are currently near yesterday's highs, we should also keep an eye on resistance near the internal uptrend. This trendline should provide a clue as it is also the downside support of the ascending parallel trend channel. This channel shows symmetry within an uptrend. That symmetry is broken on the drop below the lower trend line, with the next lower trend line moving slightly lower on its way to the 200-day moving average at 2,398.
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