FUNDAMENTAL
OVERVIEW
Oil prices continue to edge
higher amid the lack of progress in the US-Iran negotiations and the Strait of
Hormuz closure. The latest reports say that Iran proposed to reopen the Strait
of Hormuz if the US blockade is lifted and then hold nuclear talks later.
Trump has been insisting on
reaching a deal before the US blockade is lifted and the US stock markets
making new all-time highs almost daily might not change his position. This
could prolong the stalemate and keep oil prices supported.
CRUDE OIL
TECHNICAL ANALYSIS – DAILY TIMEFRAME
WTI crude oil – daily
On the daily chart, we can
see that crude oil is now trading above the 93.00 resistance zone after the breakout
in the final part of last week. We can expect the buyers to continue to step in
around the zone with a defined risk below it to keep pushing into the cycle
highs. The sellers, on the other hand, will want to see the price falling back
below the zone to pile back in for a drop into the 78.00 support next.
CRUDE OIL TECHNICAL
ANALYSIS – 4 HOUR TIMEFRAME
crude oil – 4 hour
On the 4 hour chart, we can
see more clearly the recent price action with the bullish momentum increasing
after the break above the downward trendline that was defining the pullback
into the 78.00 support. The first target for the buyers should be the swing
level around the 105.00 handle. That’s where we can expect the sellers to step
in with a defined risk above the handle to position for a drop back into the
93.00 support zone. The buyers, on the other hand, will look for a break to
increase the bullish bets into new highs.
CRUDE OIL TECHNICAL
ANALYSIS – 1 HOUR TIMEFRAME
crude oil – 1 hour
On the 1 hour chart, there’s
not much we can add here as from a risk management perspective, the buyers will
have a better risk to reward setup around the support zone, while the sellers
will need a break below the zone to reopen the door for new lows. The red lines
define the average daily range for today.
UPCOMING CATALYSTS
Tomorrow we get the US Consumer Confidence report. On Wednesday, we have the
FOMC policy decision. On Thursday, we get the US Q1 GDP, the US Employment Cost
Index and the latest US Jobless Claims figures. On Friday, we conclude the week
with the US ISM Manufacturing PMI. It goes without saying that the focus remains
solely on US-Iran headlines.
