Crude Oil fell below the key $83 support zone last week as the geopolitical risk faded. In fact, Israel eventually retaliated against Iran last Friday, but the attack was limited, and Iran downplayed the airstrikes leading to a general de-escalation. On the macro side, higher yields and the retreat in rate cuts expectations led to some weakening in demand, which was also seen yesterday in the US PMIs commentary. Looking forward, if we start to get more weak data, the market might continue to fall with the next target being the $78 price region.
WTI Crude Oil Technical Analysis – Daily Timeframe
On the daily chart, we can see that Crude Oil broke below the key $83 support zone and the trendline and pulled back for a retest. This is where we can expect the sellers to step in with a defined risk above the red 21 moving average to position for a drop into the next major trendline around the $78 level. The buyers, on the other hand, will want to see the price rising back above the trendline to position for a rally into the $90 level.
WTI Crude Oil Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that we have a downward trendline now which will act as resistance on the way up. This will add another layer of confluence for the sellers to pile in around these levels and position for a drop into the major trendline. The buyers, on the other hand, will want to see the price breaking above it to start targeting new highs.
WTI Crude Oil Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that if we were to fall from these levels, the sellers will need to break below the strong $81 support to increase the bearish bets into new lows. The buyers, on the other hand, will likely step in at the support again to try another breakout to the upside.
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