Oil prices rebound into triple digit levels amid lack of US-Iran breakthrough
FUNDAMENTAL OVERVIEW
Oil prices came under some renewed pressure in the final part of last week on hopes that Iran would accept the US war-ending proposal after Axios reported the two parties were getting close to a one-page memo and that US officials were expecting Iran's response to several key points in the following 48 hours. That was preceded by Trump pausing Project Freedom which was interpreted as another step towards a deal.
Unfortunately, both Trump and Iran rejected the respective proposals calling them unacceptable and leaving the two sides miles apart on any potential agreement. Moreover, Israeli PM Netanyahu confirmed that the removal of Iranian nuclear material remains an active war priority, and separate reports indicated that Trump told Netanyahu directly he wants to go in on Iranian nuclear sites.
This kind of headline noise has been going on for several weeks and kept the market in rangebound mode as traders continued to wait for new developments before picking a direction. The unlimited ceasefire is acting as a ceiling for oil on hopes of an eventual end. The tensions and lack of breakthrough though are acting as a floor on risks that things could escalate any time.
The reopening of the Strait should take oil prices back to pre-war levels, but if the war were to restart, we can expect prices to spike into new cycle highs.
CRUDE OIL TECHNICAL ANALYSIS – DAILY TIMEFRAME
On the daily chart, we can see that crude oil probed below the 93.00 support zone last week but couldn’t extend the breakout. Overall, the price action remains mostly rangebound with bouts of volatility coming from US-Iran headlines. This is unlikely to change until we get a real breakthrough or the restart of the war.
CRUDE OIL TECHNICAL ANALYSIS – 4 HOUR TIMEFRAME
On the 4 hour chart, we have a downward trendline defining the resent bearish momentum. The sellers stepped in around the trendline with a defined risk above it to position for a drop into new lows. The buyers, on the other hand, will want to see the price breaking higher to pile in for a rally into the 112.00 handle next.
CRUDE OIL TECHNICAL ANALYSIS – 1 HOUR TIMEFRAME
On the 1 hour chart, the recent price action might have formed a bearish flag, but we will need a break below the bottom trendline to confirm it. For now, we can expect the sellers to pile in around the top trendline to position for a pullback into the 93.00 support targeting a breakout.
The buyers, on the other hand, will either wait for a better risk to reward setup around the bottom trendline and the support or a break above the major downward trendline to position for a rally into the 112.00 level next. The red lines define the average daily range for today.
UPCOMING CATALYSTS
Tomorrow we get the US CPI report. On Wednesday, we have the US PPI data. On Thursday, we get the US Retail Sales report and the latest US Jobless Claims figures.
This article was written by Giuseppe Dellamotta at investinglive.com.提供 MainLink：Investinglive RSS Breaking News Feed
FX初心者には必須 無料のうちにGET！
