Crude Oil Price Analysis – WTI Gaps Higher as US-Iran Hostilities Flare

WTI Crude Oil Technical Analysis

The lightweight crude oil market has gapped higher to kick off the trading session here on Wednesday as we continue to see a lot of noisy behavior. That being said, the market is likely to continue to be somewhat choppy, and I do think that there are a lot of questions out there as to what happens next. I think oil probably rallies a bit, but the 200-day EMA could cause some issues unless, of course, the hostilities in the Middle East pick up again.

It’ll be interesting to see how this plays out. I think this is all a big negotiation tactic, but we’ll have to wait and see whether or not that’s true. What I think won’t matter depending on what happens as far as a response by the Iranians.

Brent Crude Oil Technical Analysis

The Brent market looks very much the same. It also has the 200-day EMA sitting above; in this case, it is at the $83 level, it offers a bit of a ceiling. And I think you probably continue to look at this through the prism of a market that perhaps is going to be a fade-the-rally type of situation if we get any signs of significant weakness.

If you’ve been watching me for a couple of days, I said that we will try to find some type of summer range, and maybe this is what causes us to explore the upside. I do think that oil’s going to have a hard time spiking like it once did.

Yes, this is a little bit of a sharp reaction, but I think it’s probably short-lived. Ultimately, before it’s all said and done, I think most people want this to be over with, including the combatants in the Middle East so we’ll see. As things stand right now, though, signs of exhaustion, I’m willing to short.

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