FUNDAMENTAL
OVERVIEW

Oil prices remain mostly rangebound,
but there’s been more bearish pressure since Wednesday following several
positive news on the US-Iran front. In fact, oil prices sold off after Trump paused Project Freedom so that the US could work to finalise
a deal with Iran. The pause was of course interpreted as another step towards a
deal.

We then also got an Axios report saying that US and Iran were getting close to a
one-page memo to end the war and that US officials were expecting Iran’s
response to several key points. Iran hasn’t responded yet.

Late yesterday, we saw some upside in oil prices on renewed tensions in the
Strait of Hormuz. In fact, The US and Iran exchanged fire in the most serious
test of their month-long ceasefire, with Iranian forces attacking three US Navy
destroyers in the Strait of Hormuz using missiles, drones and small boats, and
the US responding with strikes on Bandar Abbas and Qeshm Island.

The escalation was followed by quick de-escalation though as a US official
described the strikes as not an act of war and said the ceasefire remained in
effect. Trump later told ABC the strikes were a “light blow” and a
“love tap” and confirmed ceasefire negotiations with Iran are
continuing.

The constant push for a
diplomatic resolution instead of another full-fledged war has been capping the
upside on expectations that a deal would be reached eventually.

CRUDE OIL
TECHNICAL ANALYSIS – DAILY TIMEFRAME

On the daily chart, we can
see that crude oil probed below the 93.00 support zone but couldn’t extend the
breakout. We are now consolidating around the support as traders await new
catalysts to pick a direction.

CRUDE OIL TECHNICAL
ANALYSIS – 4 HOUR TIMEFRAME

On the 4 hour chart, we have
a downward trendline defining the resent bearish momentum. If we get a pullback,
we can expect the sellers to lean on the trendline with a defined risk above it
to keep pushing into new lows. The buyers, on the other hand, will look for a
break to pile in for a rally into the 116.00 level next.

CRUDE OIL TECHNICAL
ANALYSIS – 1 HOUR TIMEFRAME

On the 1 hour chart, we
have a minor upward trendline defining the current consolidation. The buyers
will likely continue to lean on it to keep pushing into new highs, while the
sellers will look for a break to increase the bearish bets into the 78.00
support next. The red lines define the average daily range for today.

UPCOMING CATALYSTS

Today we conclude the week with the US NFP report and University of
Michigan Consumer Sentiment survey. It goes without saying that US-Iran
headlines will continue to dominate the price action.