FUNDAMENTAL
OVERVIEW
Oil prices dived today after
Trump announced on Truth Social a two-sided ceasefire agreement for two weeks
while the US and Iran negotiate a lasting peace deal. The ceasefire included
the reopening of the Strait of Hormuz as condition. The discussions will begin
on Friday in Islamabad and may be extended if both parties agree.
There’s still a risk that
the war could restart any time as the US and Iran haven’t officially ended the
hostilities. Nonetheless, the bias has now turned bearish for crude oil given Iran’s
acceptance of the ceasefire despite being against it for a long time. This will
likely keep expectations positive for the negotiations.
It goes without saying that
if the negotiations fail and the conflict resumes, oil prices will quickly rise
back to pre-ceasefire levels and might even extend into new highs.
CRUDE OIL
TECHNICAL ANALYSIS – DAILY TIMEFRAME
On the daily chart, we can
see that crude oil plummeted into the 93.00 support zone before pulling back a
bit. That’s where the buyers stepped back in with a defined risk below the
support to position for a rally into new highs. The sellers, on the other hand,
will look for a break to increase the bearish bets into new lows.
CRUDE OIL TECHNICAL
ANALYSIS – 4 HOUR TIMEFRAME
On the 4 hour chart, we can
see the price rejected several times the upper bound of the channel and
eventually dropped quickly to the bottom trendline following the ceasefire
announcement. On Friday, we conclude the week with the US CPI report and the
University of Michigan Consumer Sentiment survey. As a reminder, we have also
the US-Iran negotiations in Islamabad on Friday
