WTI Crude Oil Futures (March)
Friday’s Settlement: 74.66, up +0.04 [+0.05%] for the day, down -2.73 [-3.53%] for the week
Last week’s sell-off was driven by fears of a global economic slowdown as trade tensions ratcheted higher with the arrival of President Trump. The weekly EIA number showed another large crude draw.
The easing of Middle Eastern tensions also helped lower prices as risk-premia was sucked out of the market. On Saturday night, President Trump proposed resettling Palestinians outside of Gaza. This is a sharp departure from traditional U.S. foreign policy, which has generally proposed some sort of two-state solution with Palestinians remaining in Gaza. This proposal could flare tensions, and is something we’re keeping an eye on.
The U.S. cold streak came and went, and longer-range models are running warmer across the states. Natural Gas is down -6.28% this morning.
Today, futures are lower by -0.26 [-0.35%] to 74.40
There is a sharp risk-off trade driving markets today. U.S. equity futures are trading sharply lower while bonds are sharply higher, the Dollar is weaker while gold is lower by 50bps.
Crude Oil has been caught in the risk-off flows, but is holding in there being down only -0.26.
The risk-off move is tied to the release of the Chinese Ai model “Deep Seek”. There is a fear within markets that the Chinese Ai model was trained on much cheaper and less powerful chips than American large language models. American tech stocks are sharply lower on the news.
Technical Analysis:
Futures traded below our major three-star support level of 74.18 this morning, making a low of 73.67. With the severity of today’s risk-off move in other markets, if futures can settle above the 74.18-74.49* level, it would signal bullish momentum moving forward while a settlement below would signal a likely move towards the 72.97-73.24* level.
Today’s volatility is sharp, and traders should proceed with caution as a flurry of new policies, executive orders, and Trump comments are likely today with the equity sell-off.
Intraday, our pivot and point of balance is set at….
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