Forex▲ Bullish
Oil Holds $70 Support as US Strikes Cap Range
WTI crude gapped higher after US strikes on Iranian targets, reinforcing $70 support. The 200-day EMA near $75 caps the upside, locking oil in a summer range.
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Oil prices gapped higher at the open Monday after reports of fresh US military strikes on Iranian-linked targets in Syria and Iraq. WTI crude jumped more than 2% in early trading, recovering from last week's lows near $68. The move reinforces the $70 area as a short-term floor, analysts said.
Brent crude followed with a similar gap higher. Both benchmarks remain below their 200-day exponential moving averages, a level that has capped rallies in recent weeks. “We’re stuck between support and resistance,” one London-based broker said. “The geopolitical noise keeps a bid under the market. Without a catalyst to push through the 200-day, it’s a range.”
The $70 handle on WTI has drawn buyers since April, with each test attracting fresh long interest. The 200-day EMA near $75 has been equally sticky, rejecting a breakout attempt in early March and again in late May. The distance between those two levels defines the current range, roughly $68 to $76 on WTI. Brent occupies a similar band.
Trading volumes were elevated Monday but not extreme, suggesting the gap was driven more by positioning than a fundamental shift. “We haven’t seen much follow-through after the initial jump,” the broker added. “It’s an excuse to buy the dip, not a breakout.”