WTI crude oil daily chart ($/bbl)
The surge higher in oil is being tempered by a move close to the 200-day moving average (blue line) at $68.45 as well. Overnight, we saw oil rally to its highest since April as the US called to move personnel from the Middle East here. The tensions ramped higher with word being that Israel was ready to launch a full operation into Iran. Since then, things have calmed down a little as US and Iran are set to talk again on Sunday.
As tensions are high, the fear is that Iran might retaliate on any attacks by striking US sites in Iraq. As added context, Iraq is the second-largest producer of crude oil in OPEC – just behind Saudi Arabia.
It’s a tricky situation as Iran has been threatening striking US bases in the region with talks going nowhere. And for someone who loves to boast about his wins, Trump saying this is a bit of a warning signal.
At the end of the day, we’ll have to wait and see now as tensions are running high and emotions are dominating the trading landscape. So, keep an eye out on the headlines here in the meantime. Despite mostly a focus on trade, the developments in the Middle East are also going to matter quite a bit for broader market sentiment before the weekend in the next two days.
ForexLive.com
is evolving into
investingLive.com, a new destination for intelligent market updates and smarter
decision-making for investors and traders alike.
