WTI outlook: Crude Oil is on track for the biggest weekly gain in four years

WTI

WTI Oil price jumped above $86 per barrel on Friday, extending steep ascend into fifth straight day, on track for the biggest and steepest weekly gain since early 2022, when the war in Ukraine started.

Growing fears of stronger supply disruption due to closure of Hormuz strait and signals that war may extend until September, or more worrying latest comment from President Trump that there are no time limits for the duration of the war, are expected to continue to inflate oil prices.

On the other hand, Russian oil supply remains stable (US lifted some sanction for buying Russian oil) that may partially offset negative impact.

The latest market action and deteriorating conditions suggest that oil price can hit $100 per barrel, which is still away from spikes in 2022 ($130) and 2008 ($147).

Friday’s strong acceleration surged through round-figure $80 barrier and broke technical resistance at $85.53 (Fibo 76.4% of $95.00/$54.87, 2023/2025 downtrend), violation of which to open way towards Apr 2024 double-top ($87.61) and unmask $90 barrier.

Although the price action remains well supported by favorable fundamentals (key driver), we should expect some price adjustments as daily and weekly studies are strongly overbought and some traders are likely to collect profit profits at the end of the week.

However, dips are likely to be limited to keep larger bulls intact and provide better levels to re-enter strong bullish market.

Broken barriers at $80 (round-figure) and nearby $79.67 (Fibo 61.8% of $95.00/$54.87) reverted to supports which should ideally contain dips.

Res: 86.67; 87.61; 89.38; 90.00.
Sup: 84.90; 83.50; 81.80; 80.00.