West Texas Intermediate (WTI) crude was higher on the session, but price action remains below key price levels. Traders are cutting back as the Iraqi Army looks to be taking back some ground captured by militants. Gene McGillian, an analyst and broker at Tradition Energy, said “at these levels we really need to see future disruption to get another rally.” With the United States not looking to become overly involved, it is uncertain whether the militants will move their way down south where the majority of energy assets are located.
Crude futures seen a rejection of the supply zone at $107.37 and began to form resistance around $107 and $106.58 per barrel. Currently, price action is struggling to climb over $106.22 price resistance, which is being reinforced by the 4H 20 EMA.
A lack of a new catalyst to push crude prices higher, trading is likely to remain range bound. Look for profit taking to send prices to $106, potentially $105.50 per barrel. Whereas, a close above resistance could trigger a move to $106.58.