Oil prices flew higher yesterday in a move which saw front-month US Light scythe through resistance, gaining 3.7% over the session. The area around $70 per barrel held as resistance through the latter half of last week, and at the end of February.
But it crumbled yesterday, and the upside momentum was strong enough to take out buy stops and drive prices above $71. Crude has built on those gains this morning and is closing in on $72 per barrel, trading at highs last seen over five weeks ago.
The daily MACD is pointing north, suggesting momentum remains to the upside, although this is also an area from while the MACD has turned sharply lower on previous occasions. The big test will come on any pullbacks, to see if $71, or $70 act as strong support.
Source: TradingView
All this comes ahead of US ‘Liberation Day’ tomorrow, when President Trump announces the size and scope of his reciprocal tariffs on US trading partners. Mr Trump has already given the oil market a lift.
Over the weekend he threatened secondary sanctions on buyers of Russian oil, should Russia continue to drag its feet over agreeing to a ceasefire with Ukraine.
