Introduction
Crude Oil futures (CL) continue to consolidate and test the support zone between $62.4 and $61 as the selling pressure has not been strong enough to push the price below it. In our previous analysis, we highlighted that zone as very important because a push below it would likely lead the price to $56. Now that CL is hovering in this zone, let’s take a closer look at the technicals and the fundamentals.
Technical Overview
On the daily chart, sideways price action continues to dominate, but buyers have managed to defend the multi-month support mentioned above (Purple Box In Chart). This level has been vital for holding the price above $60, and if bears find the strength, they could push it to $56. A move below this zone would likely lead to very high volatility, especially on the first day or two of the breakout (If it occurs).
For the upside to gain traction, CL would need a decisive break above $63.80, which could lead to a retest of the $66.00–$67.00 region.
Key Levels to Watch
- Resistance: $63.80 (50-day MA), $66.50–$67.00 (200-day MA).
- Support: $61.00–$62.4 (major demand zone), $58.00 (next support).
Probability Table
| Scenario | Estimated Probability | Notes |
|---|---|---|
| Continued consolidation above $61.00 | 40% | Buyers defending the key floor; range-bound conditions persist. |
| Breakout toward $63.80–$66.00 | 30% | Requires sustained buying pressure and improving RSI. |
| Breakdown below $60.00 | 30% | Would signal renewed bearish momentum. |
Fundamentals
Crude oil prices are still being shaped by big-picture economic and political events. Tensions in the Middle East and recent OPEC+ production cuts are helping keep prices supported in the medium term. But weak demand from places like China and Europe is holding prices back.
A stronger U.S. dollar and higher Treasury yields are also putting pressure on commodities in general, making energy traders more cautious. Right now, the market is trying to balance tight supply with signs that global demand may be slowing.
Summary
Crude oil futures are stabilizing near the monthly support zone between $61 and $62.4. Sellers are trying to push the price below this level, and if this occurs, the next level would be at $56. The market remains range-bound within a longer-term downtrend, but if $60.00 holds, then it could set the stage for a gradual recovery toward the $64.00–$66.00 level.
This analysis is for educational and informational purposes only and does not constitute trading advice or a recommendation to buy or sell any futures contracts. Futures trading involves significant risk and may not be suitable for all investors. Always conduct your own research and consult with a licensed financial professional before making trading decisions.
