WTI Oil in Focus This Week

Aaron Hill
Published: Apr 21, 2024, 09:04 GMT+00:00

Oil prices will be watched closely amid tensions in the Middle East.

Oil barrels, FX Empire

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Amid tensions in the Middle East, potentially disrupting oil supplies, the oil complex is an interesting market to keep an eyeball on at the moment. As of writing, escalation between Iran and Israel has been limited following attacks from both sides earlier this month. What is reasonably clear is that both nations are trying to prevent an all-out war, for now at least.

Given Iran’s contribution to oil production (it provides approximately 3.3% of the world’s oil supply), further escalation may fuel a rise in oil prices (as well as gold prices and the US dollar on safe-haven appeal). A considerable bid in oil could also have wider-reaching implications, fuelling inflationary pressures and perhaps leading to rates remaining higher for longer.

WTI Oil Price Action

Price action on the daily timeframe concluded the week confined by support from $81.69 and resistance from $85.20.

Nestled close by current support are the 200-day and 50-day simple moving averages at $79.82 and $80.87. Aside from the moving averages, limited support exists beneath current support until $77.55, a level joined closely by an ascending channel support line, extended from the low of $67.74. If we step below here, monthly support awaits at $75.39, a level complemented by a moderate Fibonacci cluster.

Aiding current resistance is also channel resistance, taken from the high of $76.14, while north of here shines the technical light on another layer of resistance at $88.32.

Technical Direction This Week: Bulls to Buy the Dip?

The combination of the 200-day and 50-day simple moving averages at $79.82 and $80.87 and support from $81.69 could be a location dip buyers make a show from this week. This is bolstered by the current uptrend, which has been in play since late 2024, and the recent channel resistance breach demonstrating bullish strength. Similarly, another technically interesting area of support resides at $77.55, combined with channel support.



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About the Author

Aaron Hillcontributor

Aaron graduated from the Open University and pursued a career in teaching, though soon discovered a passion for trading, personal finance and writing.

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