Crude oil prices are testing a massive zone of resistance on the chart, indicating Breakout Potential. At least so far, this same zone of resistance has captured the highs for 2019, 2020, and, of course, 2021. On the other hand, the most recent iteration has some merit, given the initial reversal off of this zone was quickly supported by a trendline projection.
Bulls promptly rallied and pushed price action back into this zone, defined by two Fibonacci levels of 64.31 and 67.19. While they have yet to break through, their continuing perseverance indicates that the fight is far from over and that a topside Breakout could be on the horizon shortly. Next, I’ll take a look at a longer-term chart, which I believe adds to the appeal of this Breakout potential.
However, the trendline that had been in place for more than a decade has now been removed. This shows the possibility of a longer-term trend. There has been a lot of waffling inside the 67.00 handles at this point. The 61.8 percent Fibonacci retracement of the 2001-2008 significant advance is slightly higher, at 67.19. A bit higher than that is the recent swing-high of 67.79, which is currently the three-year high oil price.