Crude Oil prices remain buoyed by geopolitical concerns while European economy enters doom scenario

• Crude Oil remains trading at elevated levels on Monday after severe bombings in Lebanon during the weekend. 
• European PMI data shows a substantial decline in Services and Manufacturing activity in the region. 
• The US Dollar Index strengthens on Monday, with European investors heading into the safe haven Greenback. 

Crude Oil starts the week at elevated levels and holds above $70 on Monday after Israel intensified its bombing of Lebanon's key positions during the weekend. The heightened geopolitical concerns are expected to remain elevated on Monday. Meanwhile, European preliminary Purchase Managers Index (PMI) data for September reveal a severe nosedive in activity in both the Manufacturing and Services sectors, which could mean even less Oil demand is expected on the horizon for the region. 

The US Dollar Index (DXY), which tracks the performance of the Greenback against six other currencies, is being bought on Monday. Investors are fleeing away from the Euro and heading into safe havens such as the Greenback after the preliminary PMI data for September showed nearly all PMI indicators in Europe in contraction. The Euro might be poised for more downturn later this Monday, should the US PMIs outperform market expectations. 

At the time of writing, Crude Oil (WTI) trades at $70.89 and Brent Crude at $73.83.

Oil news and market movers: Quite dispersed

• More and heavier attacks to come, Israeli army spokesperson Avichay Adraee said on Monday, Reuters reports. 
• The above comments come after heavy fighting that took place on Sunday between Hezbollah and Israel, with the Lebanese militant group launching missiles deep into northern Israeli territory following intense bombardment -- some of the most severe in nearly a year of conflict, according to CNN.
• The amount of Crude Oil held worldwide on tankers that have been stationary for at least seven days fell to 56.31m bbl as of September 20, a drop of 12%, Bloomberg reports. 

Oil Technical Analysis: Fragile equilibrium

Crude Oil is facing some push backs from the bad European economic data released on Monday to be able to break higher. In case the US data comes in softer-than-expected later in the day, a further decline in global demand could be at hand, offsetting the priced-in risk premium on the geopolitical tensions in the Middle East. A thin equilibrium, which could snap at any moment and on the back of any headline. 

The first level to watch on the upside is $71.46 (the February 5 low), which returns to the table as the next level to look out for. Ultimately, a return to $75.27 (the January 12 high) is still possible, but would likely come if a seismic shift in current balances occurs. 

On the downside, the initial support remains at $67.11, a triple bottom in the summer of 2023. Further down, the next level in line is $64.38, the low from March and May 2023. Should that level face a second test and snap, $61.65 becomes a target, with $60.00 as a psychologically big figure just below it, at least tempting to be tested. 

US WTI Crude Oil: Daily Chart