Crude oil has started to recover above the $25.00 level as hopes of a massive production cut from key OPEC members helps to boost the price of oil.
Crude oil technical analysis shows that the latest recovery has helped to form a bullish reversal pattern on the lower time frames.
Crude oil medium-term price trend
Crude oil prices have started to rise over optimism that Saudi Arabia and Russia could implement a large-scale supply cut.
Crude oil price analysis shows that the $25.75 level is likely to act as a major pivot point over the medium term.
Looking at the daily chart, the February 2016 spike low is found around the $25.75. The mentioned low previously marked a major multi-year low for oil price.
If bulls can anchor the price above the $25.75 level it is possible that oil prices could start to move into a much higher price range.
The December 2018 low, around the $42.00 level, could mark the top of the range if oil prices can gain traction above the $30.00 level.
Crude oil short-term price trend
Crude oil technical analysis shows that the short-term trend remains bearish while price trades below the $42.00 level.
The lower time frames currently show that the recent rise in oil prices has created a large inverted head and shoulders pattern.
Crude oil technical chart analysis on the one-hour time frame shows that the neckline of the pattern is located around the $28.50 level.
The size of the bullish pattern implies that oil prices could eventually rally towards the $38.00 level if the $28.50 level is surpassed.
Crude oil technical summary
Crude oil technical analysis shows that continued gains above the $28.50 level could activate a bullish reversal pattern and provoke a rally towards the $38.00 resistance level.