Key Technical Barrier
The pivot high around $120 remains a key technical barrier. Supply risks in the Gulf continue to keep attention on these levels, including exports from Oman and tanker movements in Iraqi waters. We are seeing Brent crude holding firm after a massive run-up to $120 and a sharp sell-off, with the price finding a solid floor above $81. Renewed tensions in the Gulf are the main driver, especially with reports this week of tanker movements in Iraqi waters being compromised. The latest data from Lloyd’s List Intelligence shows maritime insurance premiums for the region have ticked up by 0.25%, reflecting this heightened risk. For traders anticipating that these supply threats will worsen, the recent high around $120 is the clear target. We could look at buying call options with strike prices near $110 or $115 expiring in late spring to capitalize on a potential breakout. This strategy allows us to participate in the upside if the geopolitical situation forces prices higher in the coming weeks. However, we should also prepare for prices to move sideways in a wide channel, much like they did for a stretch in late 2025. Given the current volatility, selling out-of-the-money put options with a strike price below the strong $81 support could be a viable strategy. This approach allows us to collect premium while waiting for a more decisive market direction.Support Levels To Watch
The key support levels to watch are the unfilled gap near $93.80 and the critical floor at $81. Any sustained break below $93.80 would be a warning sign to us, prompting a re-evaluation of long positions. We would use a move like that to consider buying protective puts to hedge against a fall back into the prior trading range. Create your live VT Markets account and start trading now.
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