The price of oil opened with a gap this week following the collapse of talks between the US and Iran. Last week, the US market closed at $91 per barrel, and now, with the gap, WTI is trading around $97.
This sharp movement in crude oil prices is due to heavy speculation by investors and also to market fears that future crude oil reserves will decline, which would generate more demand.
According to the H4 chart, crude oil could continue its rise in the coming hours and reach the psychological level of $100,00. If the outlook remains bullish, crude oil could continue to rise over the next few days until it reaches the top of the uptrend channel around $107.
Conversely, if tensions between the United States and Iran ease, we could expect crude oil to fall toward $93, where the 21 SMA is located, and to $89; this decline could close the gap left this week.
If crude oil encounters strong resistance around the psychological level of $100 and consolidates below this zone, it suggests an opportunity to open short positions in anticipation of a drop toward the lower band of the uptrend channel around $89.
