HG MARKETS:

WTI crude oil prices gained momentum on Thursday, approaching $69.60 in early trading. This upward movement followed an announcement by US President Donald Trump of a 25% tariff on countries purchasing oil from Venezuela. The tariff heightened concerns about a potential reduction in global supply, contributing to a rise in oil prices to nearly a four-week high.

Adding to the bullish sentiment, U.S. crude oil inventories saw a significant decline. The Energy Information Administration (EIA) reported a drop of 3.341 million barrels in stockpiles last week, the largest decline in 13 weeks and well above expectations. This unexpected drawdown reinforced the perception of tightening supply, providing further support to oil prices. Stockpiles at the Cushing, Oklahoma delivery hub also fell by 0.755 million barrels.

Despite the recent rally, the broader trend for oil remains bearish, which may limit the upside potential. A ceasefire agreement between Russia and Ukraine over maritime and energy-related targets helped ease some concerns about global supply. Additionally, the US decision to relax certain sanctions on Moscow contributed to balancing out the supply concerns triggered by the Venezuela-related tariffs.

On a technical level, WTI crude oil appears to be rebounding from long-term support near $66. However, the 50-day simple moving average (SMA) continues to trend downward, indicating a bearish outlook. There is strong resistance between the $70 and $72.50 range, suggesting that prices could move lower from this zone. On the 4-hour chart, a falling wedge pattern is forming, with resistance around $70. A break above this level may trigger further upward movement in WTI crude prices.

In natural gas markets, prices have been consolidating around the 50-day SMA. Despite a broader bullish trend, the price has been declining, reaching a strong support zone between $3.60 and $3.50. A break below this level could push prices lower toward the $3.20 to $3.00 range, especially as the Relative Strength Index (RSI) remains below its mid-level, suggesting the correction may continue. The 4-hour chart shows an ascending channel, with price nearing channel support around $3.50. A break below this level could drive prices toward $3, though the bullish trend remains intact as long as the price stays above $3.

Turning to the US Dollar Index, it has rebounded from support near 103.50 and is approaching resistance around 105.20. Although the index is trading below its 200-day SMA, indicating a negative overall trend, a break above 105.20 could propel the index toward 107. However, if the index falls below the 103.50 support, it may slide further toward 100.65. The 4-hour chart suggests a bullish rebound from 103.50, with the index trading within a descending channel. Resistance at 105.20 aligns with the channel’s upper boundary, and a break above this level could drive further gains.