WTI oil opened with gap-higher on Monday and rallied strongly, hitting new high at $72.36 (the highest since 11 July) driven by concerns about upcoming US sanctions on Iran, which already caused a fall in Iran’s oil export.
Tightening global supply and last week’s comment from Saudi Arabia, showing their agreement with higher oil prices, added to strong bullish sentiment.
Monday’s rally made eventual break above cracked Fibo barrier at $71.17 (61.8% of $75.34/$64.43 descend) and also completed inverse H&S pattern on daily chart, generating strong bullish signal.
Daily techs are in full bullish setup and support further advance, but bulls may take a breather before resuming towards target at $72.77 (Fibo 76.4%), as slow stochastic turned sideways at the border of overbought territory.
Shallow dips are expected as positioning for fresh upside, with $71.20 zone (former highs / broken Fibo barrier) expected to ideally hold.
Res: 72.36, 72.77, 73.64, 74.00
Sup: 71.80, 71.17, 70.88, 70.00
