Crude oil (April contract) dips below 100 hour MA but finds some support at trend line

100 hour MA at $60.32. Trend line at $59.94

The price of WTI crude oil futures settle at $60.53. Since then it has moved down toward the $60 level once again. The low for the day reach $59.81 a few hours ago. 

100 hour MA at $60.32. Trend line at $59.94

On the dip, the price is looking to retest a lower trendline of $59.94 currently (and rising). A moved below that line will have traders looking toward the swing lows from yesterday $59.57 and the low from Tuesday at $59.34. Hold support and get back above the 100 hour moving average currently at $60.32 would tilt the bias back to the buyers advantage.

The price of crude oil futures moved higher early in the session after the private API data showed a larger than expected drawdown of -5.8 million barrels. The Department of Energy data today came in with an even larger drawdown of -7.257M barrels.  However, the news was already priced in and the gains were limited. The price started to rotate back to the downside.  

Now with the contract testing support, and just above the $60 level, the market will test the will of the buyers up here.  Will the support hold? Or will the price probe further to the downside. The 200 hour moving average currently comes in at $59.16. The 38.2% retracement of the move up from the February 1 low comes in at $58.18. Those are the next major support targets on the downside for the contract. 

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By Jonathan Prop

Jonathan Prop is an independent financial advisor. He has been working in finance for the last 20 years. After retiring early in his 40s, Jonathan decided to help others get to grip with financial markets, particularly his area of expertise - forex!

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