Since testing the $99.00 level in Asian trade, crude oil futures for delivery in May rose to $100.03 in the European trading session.
The short term trend remains slightly bullish while higher swing highs and higher swing lows are being made, with today’s low of $99.00 marking the nearest support level. The general focus of the market is towards testing the closest resistance levels.
Selling pressure may start kicking in between $100.14 and $100.24. This is the first resistance area, a clear pivot zone formed between 6th March low and 21st March high.
Additional resistance lies further up at $100.41, marked by the 200 simple moving average on daily timeframe and the resistance of the current bullish channel; followed by $100.59, where the 200 simple moving average is located on the 4H timeframe.
Any bearish price action signals from the main resistance levels can result in yet another test of the support at $99.00, or even $98.55 – the support trendline for the current bullish channel.
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Prepared by Alexandru Z., Chief Technical Strategist at Capital Trust Markets