WTI bulls eye 4-hour resistance structure

• Oil pressured in downside correction as covid spreads.
• Markets staying tuned into the Iran elections.
• The counter trendline and prior 4-hour lows offer a compelling resistance target. 

It was a poor day for energy markets on Thursday as worries resurfaced after new coronavirus cases jumped in Britain. US West Texas Intermediate (WTI) crude dropped $1.11, or 1.5%, to settle at $71.04.

Spot WTI was ending the North American day down 0.9% after falling from a high of $72.28 to a low of $69.80. 

At the time of writing, WTI is trading at $71.00 on the nose and flat for the day so far as traders battle with the supply concerns over the return of Iranian barrels which are weighing on the market.

The energy complex will look to Friday's presidential elections in Iran that could scuttle nuclear talks between Washington and Tehran and leave US sanction on Iran's oil exports in place. Washington has sanctioned Raisi for alleged involvement in executions of political prisoners. His election matters for the oil sector because it would make it tougher for the United States and Iran to come to an agreement on Iran's uranium enrichment. Therefore, US sanctions on Iran's oil exports may not be lifted.

 WTI technical analysis

The bulls are looking to the 4-hour resistance structure and is seeking a retest of it near 71.35 where bearish commitments are expected at the counter trendline resistance.

This reinforces the area and a downside continuation could be the next chapter in the story for the closing session of the week ahead as a spree of profit-taking ensues before the weekend.