Crude oil prices struggled for the direction on Monday as a ceasefire agreement between Hamas and Israel continued to elude negotiators.
Last week, both contracts posted their steepest weekly loss in three months, with Brent drop more than 7% and WTI down 6.8%, weighed by weak U.S. jobs data and the possible timing of a Federal Reserve interest rate cut. MCX Crude oil down 6.47%.
Prices retreated from the day’s high, following the news that palestinian militant group Hamas on Monday agreed to a Gaza ceasefire proposal from mediators, but Israel said the terms did not meet its demands and pressed ahead with strikes in Rafah while planning to continue negotiations on a deal.
Israeli forces struck Rafah on Gaza’s southern edge from the air and ground and ordered residents to leave parts of the city, which has been a refuge for more than a million displaced Palestinians.
A lack of settlement between the parties in the now seven-month long conflict has supported prices, as investors worry that regional escalation of the war will disrupt Middle Eastern crude supplies.
Riyadh’s move to raise the official selling prices for its crude sold to Asia, Northwest Europe and the Mediterranean in June also supported prices, signalling expectations of strong demand this summer.
The world’s top exporter hiked its flagship Arab Light crude oil price to Asia to $2.90 a barrel above the Oman/Dubai average in June, the highest since January and at the upper end of traders’ expectations in a Reuters survey.
Technical Outlook – Crude Oil
Crude oil prices retreated from the day’s high 6613 and settled at 6542 with minor loss of 0.04%. Prices had a limited trading range yesterday.
The formation of high wave candlesticks in the above chart is a sign of indecision among traders. Prices may stabilize between 6650-6480 in the near future. Unless prices give both sides pause. However, if prices unable to break the immediate support 6480 than prices could see some recovery towards 6580-6650 again.
On the downside, a break below 6480 will open the door for next support 6420-6350.
Happy Trading!
Commodity Samachar
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