🚨Oil and gas in Europe in a panic sell-off

The energy commodities market is experiencing a sharp sell-off on Monday. Brent crude is down 7.33% to $105.08 per barrel, U.S. WTI is down 5.97% to $96.77, and European natural gas (NATGAS.EU) is plunging by as much as 10.21%—the sharpest move across the entire energy basket. The catalyst is a sudden shift in the geopolitical narrative: U.S. Secretary of State Marco Rubio stated that President Trump prefers to resolve the conflict with Iran diplomatically and “has not made a decision” to attack, while Iranian President Pezeshkian announced that the Supreme Leader has granted the government “certain powers” to engage in peace talks. Iranian and Qatari negotiators have been holding talks for several days on ending the war, and a draft agreement is already circulating.

This hits directly at the risk premium that the market had priced in for the possibility of an escalation following Tuesday’s U.S. midterm elections. Brent closed out October at a six-month high precisely because of fears of a military escalation—now those bets are being rapidly unwound. The oil market continues to react with extreme sensitivity to every headline from the Middle East.

European natural gas, however, is reacting the most strongly—the Dutch TTF contract (NATGAS.EU) is recording its largest one-day drop in many months today, falling by over 10% and giving back a significant portion of the gains driven by concerns over disruptions to LNG supplies from the Gulf and shipments through the Strait of Hormuz. Such a sharp sell-off is a classic example of speculators unwinding positions built on the expectation of escalation. It is worth remembering, however, that there are distinct volume clusters beneath the current prices—zones where the heaviest trading has occurred in recent weeks—and these may serve as natural support levels around which the market will seek equilibrium if the sell-off deepens.

Technical Analysis (NATGAS.EU, daily chart)

Today’s candlestick is a powerful bearish engulfing pattern that caps off a vertical rally in which the price climbed from around 70 to over 100. The price is down 10.21% and has rejected recent highs, indicating a blow-off top—the culmination of an uptrend driven by the war premium. This is confirmed by the ROC indicator, which plummeted to -10.21, its lowest level in months, signaling an extreme pace of the sell-off.

Two volume clusters visible on the chart are key to the future scenario. The first, upper accumulation zone extends in the 85–90 range, overlapping with the previous structural resistance (black line at ~90)—this is the first significant support level the market may target as part of a correction. The second, denser zone covers the 70–80 range, where the highest trading volume of recent weeks is concentrated; this is the structural foundation of the entire rally and the strongest line of defense for demand. Remaining above these clusters would support the thesis of a healthy correction within an uptrend.

The RSI (14) is falling to 58.65, moving from overbought territory (around 80) toward the neutral midpoint—this is not yet a oversold signal, which leaves room for further cooling before a possible stabilization. As long as the price holds the 85–90 zone, the medium-term advantage remains with the bulls; only a drop below 70 and a breach of the lower volume cluster would open the way toward the EMA200 (around 60) and a reversal of most of this year’s gains.