The crude oil market sees buying again on Wednesday, as we see more attacks from the Americans on Iran.
WTI Crude Oil
The crude oil market has gapped higher and jumped on Wednesday as the Americans have struck the Iranians again. That being said, I think this makes a certain amount of sense regardless, because if you've been watching me over the last say week or so, as we filled the gap from the start of the war, somewhere near $66 or so, then the question was, do we bounce?
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And quite often you'll see the technical suggest something before the fundamentals do. What I mean by that is you have a situation where traders are looking for the range. There's normally a range in the summer, and I think that's what we're in the middle of discovering. It'll be interesting to see how we behave near the 200-day EMA, currently at the $78.44 level, but I think if we can break above there, then the $85 level will be the next potential problem.
Summer Range Discovery and Key Technical Barriers
Typically speaking, oil likes to find a $10 range or so during the summer, and that's why I'm particularly interested in the 200-day EMA. That would basically be the same thing. Plus, of course, you have a lot of technical traders that will be watching that area, and therefore, I think it all comes together quite nicely.
Now, having said that, it's also worth noting that fundamental news such as another strike or the Iranians increasing the pressure, firing missiles into Israel, or something, could change things.
But as things stand right now, I think the market eventually probably tries to find some type of resistance that we can trade as a range going forward. It appears to me that none of the warring parties really want this to go on for too much longer. And if that's going to be the case, a range it typically is this type of market in this time of year, where you have steady demand for driving season, but nothing completely over the top.
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