Oil Price Forecast: WTI Bulls Eye Key Technical Resistance
Oil prices rallied more than 17.6% off the yearly low with the recovery now approaching key resistance hurdles. A multi-timeframe view of the oil technical charts.
Written by
Michael Boutros
Sr. Technical Strategist
Crude Oil Technical Forecast: WTI Weekly, Daily & Intraday Trade Levels
- Oil rebounds from multi-year downtrend- rallies more than 17.6% off yearly low
- WTI recovery losing steam ahead of major resistance hurdle- risk for exhaustion / price inflection ahead
- Resistance 65.62-66.31, 70.95-71.90 (key), 78- Support 59.16-60.31, 54.36/48 (key), 51.68
Crude oil prices are off more than 2.6% this week after rebounding nearly 18% off multi-year lows. WTI is now trading just below initial resistance hurdles and the first major test for the bulls- risk for possible exhaustion / price inflection ahead. Battle lines drawn on the weekly, daily, and 240min technical charts.
Oil Price Chart – WTI Weekly
Chart Prepared by Michael Boutros, Technical Strategist; WTI on TradingView
Technical Outlook: Oil pieces rebounded off downtrend support this month after plunging nearly 32% off the yearly highs. The recovery is now approaching confluent downtrend resistance at the median-line near 65.62-66.31- a region defined by the 2020 high and the 2023 close low. Looking for a reaction off this pivot zone IF reached with a breach / close above needed to suggest a more significant low is in place.
Oil Price Chart – WTI Daily
Chart Prepared by Michael Boutros, Technical Strategist; WTI on TradingView
A look at the WTI daily chart highlights the magnitude of the monthly decline and recovery. Daily support rests with the 2020 high-week close (HWC) / 100% extension of the 2023 decline at 59.16-60.31- a weekly close below this threshold would be needed to mark downtrend resumption towards the 61.8% extension of the 2022 decline / 2016 high at 54.36/48 (look for a larger reaction there IF reached). Subsequent support objectives seen at the June 2019 LDC at 51.68 and the 61.58% retracement of the 2020 rally at 49.44.
Oil Price Chart – WTI 240min
Chart Prepared by Michael Boutros, Technical Strategist; WTI on TradingView
A closer look at oil price action shows WTI trading within the confines of a proposed ascending pitchfork extending off the monthly lows with the 25% parallel offering support today. The weekly opening-range remains preserved heading into Friday and the immediate focus is on a breakout here for near-term guidance.
A breach / close above the 66.31 would expose the next major technical consideration at 70.96-71.90- a region defined by the 61.8% retracement of the yearly range, the 200-day moving average, the August low-day close (LDC) and the 2025 yearly open. Strength beyond this threshold would be needed to suggest a larger trend reversal is underway.
Bottom line: Oil has rebounded off trend support with the recovery now approaching downtrend resistance- risk for topside exhaustion / price inflection into 66. From a trading standpoint, losses would need to be limited to 59.16 IF oil is heading for a larger recovery on this stretch with a close above the median-line needed to fuel the next leg of the advance. Ultimately, a larger rebound may offer more favorable opportunities closer to trend resistance. Watch the weekly close for guidance here.
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--- Written by Michael Boutros, Sr Technical Strategist with FOREX.com
Follow Michael on X @MBForex
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