FUNDAMENTAL
OVERVIEW
Crude oil sold off last Tuesday as the expectations
for a US-Iran deal grew stronger. In fact, on Tuesday, Qatari mediators said
that the language for a possible US-Iran agreement had been drafted and US
Treasury Secretary Bessent confirmed that an Iran deal could have come as soon
as Wednesday and would have included the reopening of the Strait of Hormuz.
The losses started to get trimmed though because the
anticipated timeline for the deal passed without an announcement and there have
been mixed messages regarding the deal and the Hormuz strait. Nevertheless, the
lack of US attacks on Iran is a good signal and this will likely keep a lid on
oil prices barring another escalation.
CRUDE OIL
TECHNICAL ANALYSIS – DAILY TIMEFRAME
On the daily chart, we can
see that crude oil dropped below the key 78.00 support zone but eventually erased
most of the losses. The price is now trading above the support. This is where
we can expect the buyers to step in with a defined risk below the support to
position for a rally back above the $90 level. The sellers, on the other hand,
will want to see the price falling back below the support to pile in for a drop
into the 68.00 level next.
CRUDE OIL TECHNICAL
ANALYSIS – 4 HOUR TIMEFRAME
On the 4 hour chart, we now
have a downward trendline defining the bearish momentum. The sellers will likely
lean on the trendline with a defined risk above it to keep pushing into new
lows. The buyers, on the other hand, will want to see the price breaking higher
to increase the bullish bets into new highs.
CRUDE OIL TECHNICAL
ANALYSIS – 1 HOUR TIMEFRAME
On the 1 hour chart, we
have a minor upward trendline defining the current pullback. The buyers will
likely continue to lean on the trendline to keep pushing into new highs, while
the sellers will look for a break lower to pile in for a drop into the 68.00
support next. The red lines define the average daily range for today.
UPCOMING CATALYSTS
On Wednesday,
we have the US CPI report. On Thursday, we get the US PPI data and the latest
US Jobless Claims figures. On Friday, we conclude the week with the US Retail
Sales and the University of Michigan Consumer Sentiment report. The US-Iran
developments will remain in focus.
This article was written by Giuseppe Dellamotta at investinglive.com.
