The price of WTI Crude Oil is trading within a tight range around the $53.00 level after making a short rebound. The Light Crude remains relatively on a descending wedge, which implies a short-term bearish bias despite the recent rebound.
The price of oil rebounded on Thursday to end the day just above $53.20 and on Friday, it showed signs of a potential bull run after it momentarily gained to trade above $53.80.
However, those gains were quickly trimmed as the WTI Crude Oil edged downwards to trade at $53.25 in the early trading hours of the US session. This pinned the price of oil in a tight trading range ahead of the US data.
WTI Crude Oil Fundamentals Overview
The price of oil plunged last week after President Donald Trump indicated via Twitter that the US was going to impose trade tariffs of 5% on Mexican products entering the US soil. This sent the markets on a meltdown with stocks and oil prices edging lower in response to the news.
However, on Thursday, news emerged that the US was going to delay the move to impose tariffs on Mexico, which triggered a short-term optimism in the market. Oil prices responded by making slim gains.
But with Friday’s US non-farm payrolls missing expectations and ahead of the Baker Hughes US Oil Rig Count data, the price of oil lacked the momentum to build on yesterday’s gains.
WTI Crude Oil Technical Analysis (the 60-min Chart)
From a technical perspective, the price of oil appears to be pegged within a tight trading range ($52.41-support and $53.98-resistance), which suggests a short-term consolidation. Nonetheless, there are still some interesting opportunities for traders to target ahead of next week.
The bulls will target profits at around $53.98 in the short-term while the bulls will hope the price of oil pulls back towards $52.41.
WTI Crude Oil Technical Analysis (the Daily Chart)
In the daily chart, the price of oil appears to have recently hit the oversold zone, which triggered the latest rebound. But on a bigger scale, the WTI Crude Oil is actually shedding off gains attained since the start of the years.
As demonstrated using the Fib retracement levels, the price of oil is now pegged between 50% and 61.80% Fib levels. These levels create profit opportunities for traders in the coming weeks. The bulls will target the 50% Fib level at around $54.39 while the bears will look to pounce at around the 61.80% Fib at $51.43.
In summary, the price of the WTI Crude Oil appears to have trimmed most of the gains made between January and April this year. This suggests that the bears have control in the short-term, but the bulls will look to pounce on all rebounds as they come.