Natural Gas Remains Under Pressure At The Start Of The Week
Natural gas pulled back from session highs and moved lower as traders remained focused on weak demand.
The nearest support level for natural gas is located in the $2.80 – $2.83 range. A successful test of this level will open the way to the test of the next support at $2.65 – $2.68.
On the upside, a move above the $2.90 level will push natural gas towards the resistance level at $3.00 – $3.03. RSI is in the moderate territory, so there is plenty of room to gain momentum in the near term.
WTI Oil Retreats As Traders Focus On Potential U.S. – Iran Talks
WTI oil suffered a sell-off as traders reacted to geopolitical developments. Iran’s Supreme Leader Khamenei provided Iranian government with certain powers to continue dialogue with the U.S.
Traders believe that Khamenei is finally ready for serious negotiations with the U.S. Interestingly, Khamenei’s move suggests that Iranian officials did not have sufficient powers during previous negotiations. Anyway, traders rushed to sell oil as potential peace talks would serve as a major bearish catalyst for oil markets.
It remains to be seen whether U.S. views Iran’s actions as a serious attempt to reach a deal. According to recent reports, U.S. and Israel evaluated the potential restart of the military operation against Iran after midterm elections in the U.S. In case President Trump believes that Iran is trying to kick the can down the road without solving the issue of its nuclear program, he could restart military action. Such a scenario would trigger a strong rally in the oil markets.
Today, markets are focused on potential peace talks. If U.S. signals that it is ready for a new round of official negotiations, oil prices may gain additional downside momentum.
Currently, WTI oil is trying to settle below the support level at $95.50 – $96.00. In case WTI oil manages to settle below the $95.50 level, it will head towards the 50 MA at $94.79. A move below the 50 MA will open the way to the test of the support level at $91.50 – $92.00.
On the upside, WTI oil needs to settle back above the resistance at $100.50 – $101.00 to have a chance to gain upside momentum in the near term.
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See all Natural Gas forecastsBrent Oil Tests Support At $104.00 – $104.50
Brent oil has also found itself under strong pressure as traders reacted to geopolitical developments. Speculative traders rushed out of their long positions as oil prices may head towards the $70.00 level if U.S. and Iran reach a deal. That said, it remains to be seen whether both sides are ready for compromise.
Brent oil attempts to settle below the support at $104.00 – $104.50. In case Brent oil manages to settle below the $104.00 level, it will head towards the next support at $99.50 – $100.00. On the upside, a move above the $106.00 level will push Brent oil back towards the resistance level at $109.00 – $109.50.
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