FUNDAMENTAL OVERVIEW
Oil prices continue to consolidate around the recent highs as the US-Iran war enters the fourth week. On Friday, the Wall Street Journal reported that the US was deploying warships and thousands of additional Marines to the Middle East, despite Trump’s earlier assurances that he wouldn’t put American boots on the ground in Iran.
CBS News later reinforced those reports, saying the administration was making significant preparations for the possible use of ground troops in Iran.
Over the weekend, Trump issued an ultimatum to Iran to reopen the Strait of Hormuz within 48 hours or face strikes on key infrastructure. That deadline is set to expire later today, and it doesn’t appear Iran is willing to comply, which will keep traders on edge.
Until we get a real de-escalation, the path of least resistance for oil prices remains to the upside, with limited room for a meaningful correction.
CRUDE OIL TECHNICAL ANALYSIS – DAILY TIMEFRAME
On the daily chart, we can see that crude oil is consolidating between the 93.00 support and the 100.00 handle. There’s not much we can glean from this timeframe, so we need to zoom in to see some more details.
CRUDE OIL TECHNICAL ANALYSIS – 4 HOUR TIMEFRAME
On the 4 hour chart, we can see more clearly the consolidation between the 93.00 support and the 102.47 level. The buyers will likely continue to step in around the support with a defined risk below it to keep pushing into new highs, while the sellers will look for a break below the support to pile in for a drop back into the 80.00 handle next.
CRUDE OIL TECHNICAL ANALYSIS – 1 HOUR TIMEFRAME
On the 1 hour chart, there’s not much else we can add here as traders will likely continue to play the range until we get a breakout on either side. The red lines define the average daily range for today.
UPCOMING CATALYSTS
Tomorrow we have the US PMIs. On Thursday, we get the latest US Jobless Claims figures. As a reminder, the focus is mainly on the US-Iran war, so keep an eye on the headlines.
