Oil Technical Analysis: Bounce higher
Oil prices are in the green on Tuesday as markets trade at a solid equilibrium after tensions eased in the Middle East. However, the current price action remains fragile with US sanctions set to come in effect next week. Although they might not target Iranian Oil, they could trigger a redirection from Iran’s Oil towards other clients and away from the US and Europe. The Middle East remains thus at risk, requiring a lingering premium to remain in the price action for Oil for quite some time.
With geopolitical tensions lingering, the November 3 high at $83.34 and the $90 handle should remain as resistance on the upside. One small barrier in the way is $89.64, the peak from October 20. In case of further escalating tensions, expect even September’s peak at $94 to become a possibility, and a fresh 18-month high could be on the cards.
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