A trade through $66.48 will signal a resumption of the uptrend. It will change to down on a move through $58.53.
Trend line analysis is also showing an uptrend. It comes in at $61.77 on Monday. With the trend up, buyers are likely to step in at this level. If it fails, the selling should extend into the retracement zone.
The 200-day moving average at $60.62 and the 50-day moving average at $58.78 both confirm the uptrend. The 200-day moving average forms a support cluster with the 50% level at $60.66. The 50-day moving average forms a looser support cluster with the Fibonacci level at $59.29.
According to Reuters, WTI crude oil futures are being pressured by comments from President Trump, who said Iran was “seriously talking” with Washington. This de-escalation is easing supply disruption concerns and reducing the war premium. In my opinion, with risks of a military strike on Iran easing, the technical picture becomes clearer with the moving averages becoming a reasonable target now.
Supply Concerns Are Back in Focus
The fear of a supply disruption drove prices through the 50- and 200-day moving averages last week after supply-glut concerns capped prices under this indicator for several months. If these supply-glut fears resurface, prices should fall back under the moving averages.
They likely will. Some analysts cite the end of supply disruptions in the U.S. due to cold weather and the reopening of production facilities in Kazakhstan as weighing on prices. News that OPEC+ agreed over the weekend to keep oil output unchanged for March was also cited as a bearish factor.
