Crude Oil Holds Above Key Support After Tuesday Breakout
Crude oil settled at $78.95 Friday, consolidating gains as buyers defend a critical technical floor near $78.48.
Crude oil futures closed at $78.95 per barrel Thursday, slipping $0.65, or 0.82%, as the market spent the session grinding sideways inside a tightening range following Tuesday's technically meaningful rally. Price action stayed relatively orderly, swinging between a session low of $78.58 and a high of $80.87, with neither bulls nor bears landing a decisive blow.
Tuesday's breakout carried real weight on the charts: crude punched through both the 38.2% Fibonacci retracement of the June 3 decline — pegged at $78.48 — and a downward-sloping trend line near the same level. Since that move, the market has rotated up and down three times, carving out a pattern of slightly lower highs alongside progressively higher lows, a classic sign of compression that often precedes a directional resolution.
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Thursday's session low held roughly a dime above the $78.48 retracement, reinforcing that level as a dependable support floor and suggesting buyers remain in the driver's seat for now. As long as crude stays above that threshold, the technical setup points toward another test of this week's highs, with the 50% retracement at $82.01 representing the next significant upside objective.
The risk scenario for bulls is equally clear: a sustained close back below $78.48, compounded by a breach of the rising 100-hour moving average at $77.84, would hand the advantage back to sellers. That two-step breakdown would effectively negate Tuesday's gains and put the broader downtrend back in play.
For now, momentum remains tilted toward the buyers, but Tuesday's breakout still needs follow-through to be validated. Continue reading at Forexlive.
