Spot Brent crude oil finished lower last week. The short-term swing is $87.32 to $120.54. Its retracement zone at $104.19 to $100.01 is support. It essentially stopped the selling at $99.77 last week.
The new minor range is $120.54 to $99.77. Its 50% level or pivot is $110.16.
The long-term range is $58.98 to $120.54. Its support zone is $89.76 to $82.50.
The 52-week moving average is $74.61.
Given the current uptrend, any one of these support areas could attract new buyers if tested.
The key level on the upside is the pivot at $110.16. Trader reaction to this price will set the tone this week.
A sustained move over $110.16 will set a bullish tone with $120.54 a potential target. A sustained move under $110.16 will signal the presence of sellers. This opens the door for a retest of $103.93 to $100.01. Taking out $99.77 will indicate the selling pressure is getting stronger with $89.76 to $82.50 the next potential target.
Keep an eye on $110.16 all week. Expect heightened volatility.
Weekly Outlook
The $99.80 pivot on June WTI crude oil is the level that sets the tone this week. Hold above it and the buyers who have been coming in on dips stay in control with $110.93 back on the radar. Lose it and $94.95 to $91.18 becomes the first area to watch followed by $83.02 to $76.44. On Spot Brent crude oil the $110.16 pivot is the equivalent level. Trader reaction there sets the Brent tone the same way $99.80 sets the WTI tone.
The negotiation headlines are going to keep driving session to session moves. One positive statement out of Tehran and the shorts cover fast. One negative statement and the longs that survived last week’s selloff start reducing again. Until there is a signed agreement or a clear breakdown in talks, this market trades on headlines and the chart levels are the guardrails not the drivers.
If you’d like to know more about how to trade crude oil, please visit our educational area.
