FUNDAMENTAL OVERVIEW
Oil prices have eased significantly on Monday after Trump announced on his Truth Social account a five-day ceasefire aimed at paving the way for “a complete and total resolution of the hostilities”. However, the selloff lost momentum as Iran denied Trump’s claims. Nevertheless, the hope for the end of the war remained given Trump’s push for negotiations.
Late yesterday, we got another spike lower after Israel’s Channel 12 reported that a month-long ceasefire could be announced while the US and Iran negotiate 15 key points. Traders are now waiting to see whether Iran will accept the plan. If it does, oil prices should drop to pre-war levels. On the other hand, a rejection might take prices back near triple digit levels.
Tomorrow, there's a potential US-Iran meeting in Islamabad, so everyone's going to be laser focused on that.
CRUDE OIL TECHNICAL ANALYSIS – DAILY TIMEFRAME
On the daily chart, we can see that crude oil broke below the 93.00 support following Trump’s ceasefire announcement and opened the door for a correction into the 78.00 level. There’s not much else 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 that we’ve gone from one consolidation to another as the price is now trading between the 93.00 resistance and the weekly low around the 84.00 handle. If we get another pullback into the resistance, we can expect the sellers to step in with a defined risk above it to position for a drop into the 78.00 support next. The buyers, on the other hand, will look for a break higher to pile in for a rally into new highs.
CRUDE OIL TECHNICAL ANALYSIS – 1 HOUR TIMEFRAME
On the 1 hour chart, there’s not much else we can add here but a break below the 84.35 low could increase the bearish momentum as more sellers will likely pile in to extend the correction into the 78.00 support next. The red lines define the average daily range for today.
UPCOMING CATALYSTS
Tomorrow we get the latest US Jobless Claims figures and a potential US-Iran meeting in Islamabad. The focus is now on US-Iran negotiations.
