Crude Oil Price Update – Rangebound While Waiting for Next Catalyst

U.S. West Texas Intermediate crude oil futures finished higher on Thursday after OPEC and its allies announced that they have decided to gradually increase oil production by some 2 million barrels per day from May to July, moving cautiously in pace with the recovery of the global economy from the COVID-19 pandemic.

On Thursday, May WTI crude oil settled at $61.45, up $2.02 or +3.40%.

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According to reports, the group known as OPEC+ is restoring production that was slashed last year to support prices as demand sagged during the worst of the pandemic recession, which sapped demand for fuel. The group will add back 350,000 barrels per day in May, 350,000 in June, and 400,000 in July.

[fx-image src=/2021/04/Daily-May-WTI-Crude-Oil.jpg data-zoom-target=https://responsive.fxempire.com/cdn/n/n/_fxempire_/2021/04/Daily-May-WTI-Crude-Oil.jpg originalWidth=1920 ratio=1.99]Daily May WTI Crude OilDaily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through $57.25 will signal a resumption of the downtrend. The main trend changes to up on a trade through $66.44.

The minor trend is also down. A trade through $62.27 will change the minor trend to up. This will also shift momentum to the upside. A move through the minor bottom at $58.85 will indicate the selling is getting stronger.

The main range is $51.37 to $67.79. Its retracement zone at $59.58 to $57.64 is controlling the near-term direction of the market, having stopped the selling pressure for over two weeks.

The minor range is $66.44 to $57.25. Its 50% level at $61.85 is resistance.

The short-term range is $67.79 to $57.25. Its retracement zone at $62.52 to $63.76 is controlling the upside.

[fx-article-ad]Short-Term Outlook

With the market testing two retracement zones during the last half of March, the resistance has clearly been established at $61.85, $62.52 and $63.76, and the support has been defined as $59.58 to $57.64.

Were likely to continue to see a two-sided trade until the market can break out of this range.

For a look at all of todays economic events, check out our economic calendar.