Oil Price Outlook: Crude Surges- Bulls Eye Major Breakout at May High

(MENAFN- DailyFX) Crude Oil Technical Forecast: WTI Weekly Trade Levels

• updated technical trade levels – Daily & Intraday Charts
• threatens major breakout 2019 highs / constructive while above 64.65
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Oil prices surged more than 4.5% off the weekly lows with the WTI threatening a major breakout at resistance into the monthly range / 2019 swing highs. We’re looking for a reaction here with a breach / close above needed to keep the immediate advance viable in the days ahead. These are the updated targets and invalidation levels that matter on the weekly chart. for an in-depth breakdown of this crude oil price setup and more.

Chart Prepared by , Technical Strategist;

Technical Outlook: In last month’s we noted that WTI was approaching confluence resistance near the 64-handle and be on the lookout, ''for possible inflection off this zone with a breach / close above needed to keep the immediate advance viable towards the 2019 high-week close / 2021 high close at 66.14/26.” Crude prices registered a high at 64.35 before posting an outside-day reversal lower with the pullback rebounding off confluence support into the close of April.

Crude prices have rallied more than 10% off that low with the advance now probing key at 66.14/26- looking for a reaction up here. A topside breach / close above would be needed to keep the immediate long-bias viable towards subsequent objectives at the 100% extension / 2021 yearly high at 67.72/94 and the 61.8% retracement of the 2011 decline at 70.95. Key daily / bullish invalidation rest with the 38.2% retracement / monthly open at 63.10/45.

Notes: A closer look at Crude price action shows WTI trading within the confines of an ascending extending off the March / April low with price turning this week just ahead of the lower parallels. A breakout of the weekly on Wednesday has fueled a rally back into key resistance at the 2019 high-week / high-day close / 2019 high at 66.15/57- look for a reaction into this zone with a close above needed to keep the rally viable into the close of the week. Initial support 65.56 backed by near-term bullish invalidation at the yearly high-day reversal-close at 64.65. Ultimately a break / close below 63.10 would be needed to put the bears in control.

Bottom line: The crude oil rally is now testing key resistance into the May opening-range highs. From at trading standpoint, a good region to reduce long-exposure / raise protective stops – losses should be limited by 64.65 IF price is indeed heading higher with a close above 66.57 needed to fuel the next leg higher. Keep in mind this is a major resistance zone we’ve been tracking for months now – a breach could fuel another accelerated run for the bulls- stay nimble here. Review my latest for a closer look at the longer-term technical trading levels.

For a complete breakdown of Michael’s trading strategy, review his

• A summary of shows traders are net-long crude oil - the ratio stands at +1.20 (54.60% of traders are long) – typically bearish reading
• Long positions are 11.25% lower than yesterday and 13.31% higher from last week
• Short positions are9.57% higher than yesterday and 24.91% lower from last week
• We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Oil - US Crude prices may continue to fall. Yet traders are less net-long than yesterday but more net-long from last week and the combination of current positioning and recent changes gives us a further mixed Oil - US Crude trading bias from a standpoint.

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--- Written by , Technical Strategist with DailyFX

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