Usman Salis
⬤ WTI oil is bumping up against a long-term descending trendline that's been guiding prices since the mid-2000s. This isn't just some random technical line - oil has consistently found support or resistance here across multiple market cycles. Rather than smashing through it, prices tend to stabilize around this zone.
⬤ What makes this trendline interesting is how it's behaved over time. During both booming markets and busts, WTI keeps coming back to this same diagonal level. It's less of a short-term barrier and more of a macro reference point where big moves either start or pause. Recent positioning data suggests something's shifting - oil funds have turned bullish with net positions jumping to 509M barrels.
⬤ There's a growing narrative that energy could be one of the year's defining themes. But it's not all smooth sailing - US targets on Iran-China supply pose risks to WTI, potentially disrupting the supply-side dynamics.
⬤ Here's why this matters: when a major commodity keeps reacting to the same structural zone for decades, it usually signals something bigger. We're not just talking about a technical bounce - this could mark a shift in the broader commodity cycle and long-term market positioning. Whether WTI breaks above or bounces off this trendline could set the tone for energy markets throughout 2025.
Usman Salis
