Oil, Natural Gas, USD/CAD Analysis: Market Volatility Amid Tariffs and Economic Uncertainty

WTI crude oil (CL) prices rose on Friday after US labour market data was released, driven by optimism over energy demand. Despite weaker-than-expected job additions, steady wage growth and a stable unemployment rate signalled economic resilience. A strong labour market indicates sustained energy consumption, supporting oil demand.

Moreover, the US imposed new tariffs and sanctions on an international network involved in Iranian crude shipments. Meanwhile, US drilling activity increased slightly, with the number of active oil rigs rising by one. However, the rig count remains lower than last year. Positioning data showed that speculators reduced net long positions in Brent and WTI, signalling some market hesitation. WTI crude oil rebounds to $72.50, while Brent crude oil (BCO) rebounds to $76.50. Geopolitical developments and supply constraints continue to support elevated oil prices, impacting Canadian Dollar movements.

The USD/CAD pair remained volatile as oil prices and US trade policies influenced market sentiment. The Canadian Dollar faced pressure after US President Donald Trump announced steep tariffs on steel and aluminium imports. Since Canada is the leading exporter of aluminium to the US, these tariffs pose economic risks. The uncertainty in the oil market due to trade tensions creates uncertainty for the Canadian Dollar. If oil prices continue to rise, the Canadian Dollar could recover, but trade disputes might limit its gains. The market waits for the US inflation data this week, which will likely drive the US dollar and commodities market.

WTI Crude Oil (CL) Technical Analysis

Oil Daily Chart – Reversal

The daily chart for WTI crude oil shows a strong rebound initiated after the release of employment data last week. The price is breaking above the 50-day SMA, signalling a potential reversal. However, it remains within the wide range of a triangle formation between $68 and $80. As long as the price stays within this range, the oil market will likely fluctuate widely. A break above the 200-day SMA at $74.50 would indicate a bullish move toward $80. On the other hand, if WTI crude oil fails to break above the 200-day SMA and moves lower, the price will likely continue toward $68.

Oil 4-Hour Chart – Consolidation

The 4-hour chart for WTI crude oil shows the market rebounding from the $70.50 zone and breaching the $72.50 area. Bearish pressure is likely as long as the price remains below the $75 level. A break above $75 will erase the bearish pressure and push WTI crude oil further upside to $80.

Natural Gas (NG) Technical Analysis

Natural Gas Daily Chart – Rebound from Key Support

Natural gas prices rebound from the $3 level, showing strong bullish price action. A break above the 50-day SMA at $3.50 will likely trigger the next move toward $5. The 50-day SMA remains above the 200-day SMA, indicating strong bullish potential.

Natural Gas 4-Hour Chart – Ascending Channels

The 4-hour chart for natural gas shows that the price rebounds from $3 within an ascending channel, displaying positive momentum from the channel’s support. The positive price action at the pivotal $3 support level suggests that natural gas prices are building bullish momentum.

USD/CAD Technical Analysis

USD/CAD Daily – Market Uncertainty

The daily chart for USD/CAD shows the pair consolidating in support of an ascending channel, forming a base pattern at this level. The 50-day SMA further strengthens this support. However, President Trump’s tariff uncertainty has increased price volatility, leading to wide trading ranges. The RSI has broken below the mid-level, suggesting the pair may consolidate to the downside. However, large movements in the US Dollar Index have created uncertainty in the USD/CAD market.

USD/CAD 4-Hour Chart – Market Uncertainty

Price volatility in USD/CAD is also evident on the 4-hour chart. The pair has broken the six-month ascending channel, indicating weakness. However, USD/CAD faces strong support at $1.4110. A break below $1.4110 will trigger further downside in USDCAD.