Crude Oil Gains Support as Iran Squeezed Out, Trade War Lingers
Arslan Butt • 1 min read
The black gold, crude oil, continues to trade sideways at $52.32, losing -0.76% for the day. Honestly, the market is a bit confused about whether to go long on Iran’s sanctions or to go short on the US-China trade war concerns.
Crude oil exhibits weakness as concerns grew that US-China talks this week would not fix a crack over trade between the world’s largest economies. The US and China are trying to come up with a deal ahead of the March 1 deadline as, after this, the US will increase the 10% tariff to 25%.
China, the world’s second biggest economy, has more to lose if they fail to keep tariffs on hold. In response, their manufacturing may suffer and we may see a drop in crude oil prices. This is why investors are trading oil with a bearish sentiment.
Technically, an upward trendline is supporting WTI crude oil above $52.30. While the 20 periods moving average is still signaling a bearish bias. Crude oil may trade bearish below $53, support becomes resistance level. However, the bullish breakout of $53 can lead oil prices towards $54.15.