$50.00 Back In Play For WTI Crude Oil
From a technical standpoint, the $50.00 handle in January WTI crude oil is the 5000-pound elephant in the room.
January WTI crude oil futures are on the bear, trading toward the $50.00 psyche level. Prices have fallen consistently since the U.S. session kicked off, with order flow spiking beneath Friday’s low ($50.84). At press time, price is rotating between the $50.50-$51.00 levels, with the intraday downtrend remaining valid.
January WTI Crude Oil
From a technical standpoint, the $50.00 handle in WTI crude is the 5000-pound elephant in the room. Buyers have defended this area vigorously over the past two weeks, producing very tight trading conditions.
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For the remainder of the session, there are three levels on my radar:
- Resistance(1): Daily SMA, $52.89
- Support(1): Psyche Level, $50.00
- Support(2): November Low, $49.41
Bottom Line: The long-term bearish trend remains intact for January WTI crude, with $50.00 setting up to be an intermediate-term bottom. However, in the event that it gives way, there may be a solid short scalping opportunity for the near future.
Until elected, I will have sell orders queued up from beneath November’s low at $49.40. Using a tight 1:1 risk vs reward ratio, this trade is good for a fast 8-12 ticks on a breakout to the bear. Immediate and positive price action is the goal ― if the market reverses at November’s low, don’t hesitate to bail out of the short position!
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