Crude oil is settling the session at $79.34, up $1.20 on the day, with prices continuing to edge higher in after-hours trading near $79.68. The day’s range was wide, with a high of $81.27 and a low of $77.84, highlighting the volatility driven by developments surrounding U.S. policy on the Strait of Hormuz.
During the North American session, prices tumbled after President Trump abandoned his proposal to impose a 20% charge on cargo exiting the Strait of Hormuz, a policy he had unveiled just one day earlier. Instead, he shifted toward a framework that would encourage foreign shipowners and governments to make investment commitments in the United States. While details of how that investment proposal would work remain unclear, the market appeared to conclude that the original 20% fee was unlikely to be practical or sustainable, prompting traders to unwind some of the geopolitical risk premium that had been built into prices.
Technically, however, the decline found an important floor. Sellers pushed crude down to $77.84, where the price found support at the underside of a previously broken trendline. That successful retest attracted buyers, sparking a sharp rebound. The recovery carried crude back above the June 17 high at $79.18, turning that former resistance back into support and frustrating sellers who had hoped the earlier decline would lead to a deeper correction.
As long as the price remains above the $79.18 breakout level, buyers retain the near-term technical advantage. Today’s ability to reject the break below trendline support and reclaim an important prior high suggests the bullish bias remains intact despite the sharp intraday swings driven by the latest geopolitical headlines.
Sellers had their shot, but buyers came in against the underside of the trendline. Buyers are in control.
This article was written by Greg Michalowski at investinglive.com.