Oil opens with a gap down as supply concerns ease following Israel’s strike on Iran

WTI oil opened with a wide gap down on Monday, dropping to nearly one-month lows with a 5% decline at the start of the week.

The primary driver was Israel’s weekend strike on Iran, which left Iran’s oil facilities unaffected, easing fears of a supply disruption and pushing oil prices lower.

Monday’s steep drop generated a strong bearish signal, dipping well below the psychological $70 support level, which is also the base of a thick daily Ichimoku cloud that had held support over the previous three days.

Additionally, a break below the previous higher low from October 18 ($68.15) has added to the negative outlook, alongside brief recovery attempts seen in early European trading.

Bears are now targeting the lower 20-day Bollinger Band at $67.23 and October 1’s spike low at $66.33, with key support at $65.26 (the 2024 low reached on September 10) in sight.

A close below $70 is the minimum needed to sustain the bearish momentum, while a close below $68.15 would further solidify the bearish outlook, as daily indicators align fully in a bearish setup.

Res: 69.33; 70.00; 70.30; 71.00
Sup: 67.23; 66.94; 66.33; 65.26