U.S. West Texas Intermediate crude oil futures are trading lower late Friday, reversing all of its earlier gains. The market was boosted early in the session on rising concerns over further Middle East supply disruptions due to U.S.-Iran political tensions. However, traders took profits and prices began to retreat after CNBC reported that trade talks between China and the United States have stalled.
At 19:23 GMT, July WTI crude oil is trading $62.89, down $0.17 or -0.27%.
Daily Technical Analysis
The main trend is down according to the daily swing chart. However, momentum has been trending higher since the formation of the closing price reversal bottom at $60.10 on May 6.
After rallying for eight days from the bottom at $60.10, the market is posting a daily closing price reversal top on Friday. This could lead to the start of a 2 to 3 correction.
The major support is the retracement zone bounded by $59.70 to $63.36. The market is currently trading inside this zone. It is controlling the longer-term direction of the market.
The intermediate range is $66.44 to $60.10. Its retracement zone at $63.27 to $64.02 is new resistance.
The short-term range is $60.10 to $63.82. If the downside momentum continues then look for the selling to extend into its 50% level or pivot at $61.96.
Daily Technical Forecast
Based on the current price at $62.89 and the intraday downside momentum, look for a potential break into the uptrending Gann angle at $62.35. If this fails then look for the selling to possibly extend into the short-term pivot at $61.96.
On the upside, the resistance is the major Fibonacci level at $63.36.
Prices are likely to feel downside pressure into the close if U.S. equity markets continue to weaken.
This article was originally posted on FX Empire
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