Crude Oil Price Forecast: Breakdown Deepens as Key Support Fails

Crude oil is under significant selling pressure, trading near $64.16 after decisively breaking below the 61.8% Fibonacci retracement at $64.46, confirming a short-term bearish trend shift. This technical breakdown, alongside a potential nine-week daily closing low, indicates strong downside momentum and increased likelihood of further selling, with the next key support zone anticipated around $60.70.

Analysis

Crude oil's technical structure has significantly deteriorated following a decisive break below the 61.8% Fibonacci retracement level at $64.46, a key support within its recent corrective pattern. Trading near $64.16, the commodity is on course for a potential nine-week daily closing low, which confirms a short-term bearish trend shift and indicates accelerating downside momentum. This weakness is reinforced by the conversion of a former support level, the anchored VWAP at $65.58, into new resistance. The market is now poised for a large bearish weekly close, suggesting sellers are in control and increasing the probability of further declines. The next material support area is a confluence zone identified between $60.66 (the 78.6% Fibonacci retracement) and $60.78 (an ABCD pattern projection), where a market reaction or pause could occur. Until this zone is tested or price reclaims the $65.58 resistance level, the path of least resistance remains to the downside.

Key Decisions for Investors

• Given the confirmed technical breakdown and strong bearish momentum, investors with a short bias could target the next support confluence around the $60.66-$60.78 price zone.
• Traders should view any rallies toward the former support-turned-resistance at $65.58 as potential opportunities to initiate or add to short positions until the bearish structure is invalidated.
• Investors considering long positions should exercise caution and wait for a clear bullish reversal, which would require a decisive close above the $65.58 resistance level.
• Risk management should focus on the price action around the $60.70 area, as a strong technical bounce from this structurally significant zone could signal an opportunity to take profits on short positions.