Crude Oil Price Forecast: Reversal Signals Challenge Key Resistance
Author: Bruce Powers
Published: January 8, 2026
Overview
The article discusses the recent bullish reversal in crude oil prices, highlighting a significant test of resistance levels. As of the latest update, crude oil reached a high of $58.71, approaching the 50-day moving average resistance at $58.76 and a critical swing high at $59.00. A confirmation above $59.00 is deemed necessary to validate a broader trend change and set higher price targets.
Key Points
- One-Day Bullish Reversal: Crude oil has shown a one-day bullish reversal, indicating strong short-term demand. The price action suggests a potential for further gains if it can close above the previous high of $58.61.
- Higher Swing Low: The recent price movement has established a potential higher swing low, increasing the likelihood of breaking through the $59.00 resistance level. A daily close above this level would confirm a reversal and breakout from a double bottom pattern.
- Upside Targets: Should a breakout occur, the initial target is set at $60.56, with a further target at $60.77 based on an ABCD pattern structure. The 127.2% projection of this pattern suggests a potential target of $61.87, supported by historical price levels.
- Weekly Chart Analysis: The weekly chart indicates early bullish reversal signals, with a potential bullish engulfing candle forming. A weekly close above $58.65 would confirm this reversal, countering the bearish sentiment from the previous two weeks.
Conclusion
The article emphasizes the importance of monitoring crude oil prices as they approach key resistance levels. A successful breakout above $59.00 could signal a significant shift in market sentiment, potentially leading to higher price targets. Traders are advised to keep an eye on closing prices and market trends to gauge future movements in crude oil.
Author's Background
Bruce Powers is a seasoned finance professional with over 20 years of experience in financial markets. He holds an MBA and is a CMT® charter holder, having served as head of trading strategy at hedge funds and as a corporate advisor for trading firms.