Crude oil prices are in retreat after rising on the possibility of U.S. strikes on Iran. Before the retreat, however, Brent crude and WTI had jumped to the highest in months, countering bearish forecasts for the year—and tearing traders between geopolitics and fundamentals.

In fundamentals, the majority of observers and forecasters are unanimous that the supply of crude oil is substantially higher than demand. In fact, Goldman Sachs recently revised its price predictions for 2026, saying it now expected Brent crude to go even lower after shedding about a fifth of its value last year.

“Rising global oil stocks and our forecast of a 2.3mb/d surplus in 2026 suggest that rebalancing the market likely requires lower oil prices in 2026 to slow down non-OPEC supply growth and support solid demand growth, barring large supply disruptions or OPEC production cuts,” Goldman said earlier this week—even though protests in Iran were already making headlines and pushing the benchmarks higher.

On the other hand, the effective takeover by the United States of Venezuela’s oil industry has had an understandably bearish effect on prices. This week, a Washington official told media that the U.S. has sold the first batch of Venezuelan crude for $500 million, and more sales would follow. In terms of fundamentals, this strengthens the case for a bearish mood. However, statements by oil industry executives urging caution about the possibility of a quick turnaround in Venezuelan oil production have had a restraining effect on that mood.

Meanwhile, drone strikes on three tankers in the Black Sea fueled a new bout of supply disruption concern, to add to expectations of possible disruption in Iranian oil flows abroad. A Reuters report cited an unnamed source as saying Kazakhstan had suffered a 35% drop in its oil output over the first two weeks of January because of attacks that also included strikes on the Caspian Pipeline Consortium by Ukrainian forces. Kazakhstan has called on the United States and the European Union to help secure oil transport in the Black Sea.

Speaking of the European Union, reports emerged this week saying Brussels was planning a further cut in its price cap for Russian oil in a bid to reduce Russia’s oil revenues by tying Western insurance coverage to the price cap. The new level of the price cap will be set at $44.10 per barrel from next month. So far, the price caps have failed to cause much pain to the Russian budget, but the EU considers them a working mechanism to hurt Russia’s economy in a bid to make it withdraw from Ukraine.

Perhaps the most bullish development for oil from the past few days was the signal, from President Donald Trump, that he was not excluding the possibility of a military strike against Iran. That signal, however, has been quite quickly replaced by observations by the U.S. president that the Iranian government was easing its crackdown on the protesters, reducing the likelihood of a military strike. That’s when oil’s retreat began and continues today, in evidence that the glut narrative holds sway over the oil market.

Expectations of further growth in oil production remain dominant on that market, with forecasters such as the U.S. Energy Information Administration and the International Energy Agency both predicting further supply growth, even as OPEC pauses its unwinding of production cuts implemented back in 2022 to prop up prices. Even so, shale drillers are signaling they would not be happy with WTI closer to $50 than to $60, and production growth is slowing. Indeed, the EIA forecast in its latest Short-Term Energy Outlook that U.S. oil production will flatten this year, even inch down and extend that decline into 2027.

This has been ignored by the oil market so far, even though U.S. oil production has been the main driver behind bearish market predictions thanks to its fast and significant growth. That growth is now gone but everyone seems to be ignoring the fact in the firm belief there is already too much oil in the world—and the data seems to support this, with media citing a Kpler calculation there were some 1.3 billion barrels of crude on water in December, which was the highest since 2020 and the pandemic lockdowns.

Reuters’ Ron Bousso, however, noted in a recent column that a quarter of that oil comes from Russia, Iran, and Venezuela—the sanctioned producers. That oil takes longer to find buyers because of the sanctions but it does find buyers, Bousso pointed out. This suggests the number of barrels on tankers is not necessarily the most accurate indication of a physical glut, especially in light of recently released Chinese import data, showing oil imports into the country hit a record both in December and in 2025 as a whole. Predicting oil prices is notoriously unreliable. These days it is even more unreliable than usual, it seems, as conflicting narratives and agendas keep clashing, making the oil market a confusing place to be.

By Irina Slav for Oilprice.com

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Bullish Structure Reinforced by Successful Support Test

This is bullish behavior, as that price zone is the first anticipated support area for gold, and support has been seen. The market is confirming significance of the 10-day indicator and if gold remains above that line, the short-term trend is bullish. Friday’s low provides a possible minor swing low if it is sustained, and key short-term support along with the 10-day line.

Upside Breakout Levels and Near-Term Resistance Zone

On the upside, a decisive breakout above the record high of $4,643 is needed to trigger a continuation. However, gold will then quickly approach a potential resistance zone from $4,664 to $4,721. There are four indicators marking that range as a potential resistance zone. Given confirmation of strength with a bounce off the 10-day average on a pullback following a new all time high, gold could quickly push through that price zone and head towards a 78.6% projected measured move at $4,760.

Fibonacci Confluence Highlights Upper Resistance Risk

The top of the range, however, shows minor confluence with two indicators and therefore possibly a more significance resistance area. A 432.6% (261.8% + 161.8%) is at $4,713, and the 161.8% Fibonacci extension of the December decline is at $4,721. The first 127.2% extended target from December was near the trend high at $4,625 and shows a relationship with the ratios. The recognition of the first retracement ratio target enhances the chance that the higher 161.8% price area is reached as well.

Weekly Momentum Slows but Bull Trend Remains Intact

Momentum shows slowing somewhat on the weekly chart, as gold is set to close near or below the mid-point of the week’s range, which was $4,578. A stronger closing price in the upper half of the week’s range would show greater control by buyers and therefore increase confidence that bullish momentum may dominate once again. This week began with a new all time high on Monday, followed by a stall.

Nonetheless, this week’s breakout confirms on a weekly basis with a closing above the prior high of $4,550. Whether bullish momentum shows soon or after some consolidation, the bull trend remains solid if gold remains above the 20-day average, now at $4,466.

If you’d like to know more about how to trade gold and silver, please visit our educational area.

The EURJPY pair confirmed its surrender to the bearish corrective bias by reaching below 184.10 level, reaching the next target in the previous report at 183.40, to form a strong obstacle against the negative attempts.

The price is affected by sideways bias dominance due to its confinement between the barrier at 184.10 level, and forming a strong support base at 183.40 level, note that providing bullish momentum that might reinforce the chances of surpassing 184.10 level, to confirm its readiness to activate the bullish trend by its rally towards 184.85, while breaking the support will open the way for targeting new corrective stations that begin at 182.65.

The expected trading range for today is between 183.40 and 184.10

Trend forecast: Bullish

Copper price provided a new negative close below the barrier at$5.9700, announcing to delay the bullish attack, to begin activating the bearish corrective trend by reaching $5.7900 initially, approaching the initial suggested target in the previous report.

Stochastic exit from the overbought level will increase the negative pressure on the price, which makes us keep the bearish corrective suggestion, to expect targeting $5.6000 level, to press on the extra support at $5.5100.

The expected trading range for today is between $5.6000 and$5.8600

Trend forecast: Bearish correctly

Upside Targets Frame Next Resistance Zone

Going forward, a bullish continuation of the trend will be triggered on a new high and confirmed with a closing price above $4,643. That would put gold in a position to challenge potential resistance at the next upside targets at $4,664, $4,687, and $4,713. The middle target is the 161.8% Fibonacci extension of October bearish correction. Therefore, the target is derived from a short-term measurement. On the other hand, the two other price targets are from a long-term pattern. Specifically, a 350% extension and 423.6% extension of the decline that began from the 2011 peak of $1,921, respectively.

Longer-Term Projections Extend Bullish Outlook

It remains to be seen if there are signs resistance near either of those price targets but the more recent pattern target of $4,687 might have a good chance of being challenged. Above that next price zone is a $4,766 target, which is the 361.8% projection for a long-term rising ABCD pattern or measured move. It connects the 2018 swing low at $1,160 (A) and 2022 low at $1,615.

Support Levels Reinforce Bullish Trend Structure

On the downside, there are several significant potential support levels for a pullback. Short-term is the recent high of $4,550 and the rising 10-day average at $4,514. A minor swing high is at $4,500 and the 20-day average is at $4,554. Overall, the bulls remain in charge as long as gold stays above the 20-day average on a daily closing basis. Signs of strength suggest that a pullback would likely be shallow and relatively short, if it occurs before new highs.

Signs of Underlying Strength

The recent pullback in October found support near the 38.2% Fibonacci retracement. That is a relatively minor retracement, reflecting strong underlying demand. In addition, a second breakout from a rising trend channel triggered in December and the top of the channel was recently confirmed as support in a similar price area as the 20-day average. That confirms a change in character for the trend. It is gaining strength.

For a look at all of today’s economic events, check out our economic calendar.

Fibonacci and ABCD Targets Define Downside Risk

Lower targets start with an 88.6% retracement of the advance at $2.95, that began from the low in August. A little lower is the 100% projection for a falling ABCD pattern at $2.89. That matches a higher monthly low from October and therefore takes on greater potential significance. Given the conviction of sellers during the correction, with sharp declines and a failure of the long-term average, it would not be surprising to see the lower level(s) hit before the correction completes. The speed to the rebound will then provide clues to whether bearish momentum is faltering.

Bounce Potential Remains Within Corrective Structure

Despite the potential for further downside, the area around the trendline could continue to show support, leading to a bounce. Since natural gas has been correcting with a larger bull trend, it is expected to complete the retracement and continue to progress the trend. An advance above Thursday’s lower daily high will provide the next sign of strength, but within a downtrend.

Key dynamic resistance is then at the 10-day average, currently at $3.36 and falling. Short-term downward pressure remains with trading below the 10-day line. That dynamic resistance zone is followed by a lower swing high at $3.50, the 200-day average at $4.54, and another lower swing high at $3.63. A daily close above the first lower swing high at $3.50, as that would confirm a bullish reversal based on structure.

Weekly Close and Momentum Hint at Correction Maturity

Watch how the week ends, as a daily close below last week’s low of $3.13 will confirm weakness on that larger timeframe. The Relative Strength Index (RSI) momentum oscillator is near a level where support was seen during prior bearish corrections and supports the idea that the correction is close to complete. Moreover, the two largest prior bearish measured moves since the 2024 bottom ended with a 46.5% decline and a 40.7% drop price. The current decline shows a 45.3% drop in price since the December peak at $5.50. This would suggest that the current correction has hit a low or is very close to doing so.

If you’d like to know more about what drives natural gas prices, please visit our educational area.

Copper price failed to settle for long time above $5.9700 barrier, affected by stochastic exit from the overbought level, to reach $5.8800 again, which increases the chances of activating temporary negative corrective trading, facing new bearish pressures that will force it to decline towards $5.6000 reaching extra support at $5.5100.

While the price success in surpassing the barrier and holding above it will reinforce it to record new historical gains by its rally towards $6.1200 and $6.2050.

The expected trading range for today is between $5.7500 and $6.000

Trend forecast: Fluctuated within the bullish trend

The EURJPY pair failed to breach the barrier near 185.55, forcing it to delay the bullish rally and activating the attempts of gathering gains by reaching below 184.85, to approach from %78.2 Fibonacci correction level at 184.10.

The contradiction between the main indicators confirms the dominance of the sideways bias, to keep providing mixed trading until gathering bullish momentum, to ease the mission of stepping above 184.85, then wait for targeting 185.50, we should note that the price decline below 184.10 and providing negative close will increase the efficiency of the bearish corrective track, to expect targeting the next support near 183.40.

The expected trading range for today is between 184.05 and 184.85

Trend forecast: Fluctuated within the bullish track