What if the basis of your perspectives about WTI Crude Oil are wrong? What if you are trading on too much fear and not enough rationale? WTI Crude Oil is a marketplace that has astute large players positioning themselves on information gathered at a rapid pace. As the Middle East saga continues to remain unresolved and potentially dramatic, what if sentiment remains important regarding the price of WTI Crude Oil because of the U.S and Iran conflict, but actual supply numbers are the key ingredient for energy traders?
Why Supply Logistics Appear More Important Than Headlines
It is clear that the conflict in the Middle East between Iran and the U.S remains within a fragile ceasefire, one that appears ready to erupt at any moment, but also a saga that both sides constantly appear to be avoiding escalating military impact beyond certain red lines. While WTI Crude Oil remains within a price realm that has become known to all speculators, values also are signaling that there must be a reason for a rather calm trading landscape – one in which tranquil thoughts have not created massive surges upwards or ferocious slides lower. It appears that the overwhelming story in WTI Crude Oil among large players is now about adequate supply and its ability to logistically be transported from producers to users.
Why Price Remains Tranquil Despite an Unresolved Conflict
The price of WTI Crude Oil closed on Friday around $82.400, this after challenging the $83.000 ratio earlier in the day. The value of the commodity has remained tranquil as news reports consistently state that Iran and the U.S aren’t any closer to reaching an agreement. Why hasn’t the price of WTI Crude Oil jumped higher even as the marketplace seemingly knows Iran and the U.S are not about to suddenly emerge with a negotiated settlement?
The reason seems to be because large players know producers are finding ways to transport their energy resources. Producers appear to still be shipping via the Hormuz Strait with U.S military escorts while turning their AIS transponders off. Also large producers have made it known they are building and using pipelines that bypass the Hormuz Strait and deliver supply to waiting tankers using other ports. As the price of WTI Crude Oil opens on Monday it appears large player are calm because of these facts about current logistics and may keep the known value realm active.
Why This Calm May Be Easier to Misread Than It Looks
No, it doesn’t appear the conflict between Iran and the U.S is going to be settled anytime soon. But as long as the saber-rattling from both sides doesn’t escalate into a change in the balance of power being demonstrated, and both sides keep the current conditions within its simmering display, perhaps large players will not shift their outlooks too much.
If calm can prevail there may be a tendency to believe that optimism will seep into the mindsets of speculators in WTI Crude Oil and they may believe lower prices will start to be demonstrated again. However, because of the constant tension which is consistently being broadcasts via reporting, sentiment may stay cautious within large players who do not want to be surprised by possible flashes of volatility caused by Iran and the U.S becoming more hostile.
Optimism May Return if the Current Balance Holds
Wildcards exists in the WTI Crude Oil market. Day traders definitely should not place a wager and let bets linger without monitoring the situation in the Middle East, unless they are using strict take profit and stop loss ordering and are comfortable with any results that transpire. Notions of improved supply capabilities and a fragile ceasefire remain important.
However, if something were to change and Iran were to attack infrastructure or shipping that it feels threatens its status were to emerge with significant force, this could change the attitudes of WTI Crude Oil participants quickly and cause the price to fly higher. The current price realm of WTI Crude Oil can be interpreted as calm but it must be looked at with a cautious stance too, one that can be changed with unpleasant developing news that rattles sentiment.
What Traders May Need to Watch as Perspectives Shift
Traders cannot be blamed for starting to believe that WTI Crude Oil may actually remain a polite trading landscape that can be taken advantage of by using solid risk taking tactics. However, the current conditions in the Middle East as has been proven the past handful of months can demonstrate rapid shifts in sentiment. When WTI Crude Oil opens on Monday morning traders need to remain diligent with their perspectives as they interpret what has been a chaotic marketplace multiple times.
WTI Crude Oil Short Term Outlook
Current Resistance: 82.650
Current Support: 82.050
High Target: 84.100
Low Target: 78.200
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