Crude Reverses Higher as Peace Hopes Fade and Deadline Looms

Previous Session & Summary:

Yesterday, Crude fell on prior Tuesday headlines that a ceasefire and 15 point peace plan had been sent to Iran. Yesterday, despite Iran publicly stating throughout the day that a peace plan was not viable, futures were weighed by the idea of peace.

Overnight Summary & Daily Outlook

Today, futures are reversing higher as the news of peace denial set in. Markets are almost operating on a one day lag from the news. We are now in a situation where President Trump’s deadline comes into play, forcing him into striking energy infrastructure. If this were to happen, the higher for longer crude thesis takes hold.

Technical Summary

Monday – Look forward to another headline-driven week. As we’ve seen this morning, outsized price swings can be driven by seemingly random tweets. Reality is opaque, and trust in this administration is slim. This is the largest supply disruption in the oil market since WW2, and prices below $90 favor the long side.

Tuesday – Oil below $90 still presents a solid opportunity – our intraday support level is at 84.98 with an intraday pivot level of 90.59. A settlement above 90.90*** is the key for today while yesterday’s settlement of 88.13** has to serve as support through the week.

Wednesday – Yesterday’s technical outlook remains largely unchanged, and a settlement above 90.90*** remains key. Intraday pivot levels include 91.55 on the upside and 84.48 on the downside with an intraday balance level of 88.01.

Thursday – Futures are trading into resistance while most of the early week technical analysis holds true – a close above 90.90*** remains key for the bulls.