Jump to content

Brent Crude Oil Opens Higher While Markets Await Re-Test of $100 Level


Recommended Posts

BRENT CRUDE OIL (LCOC1) ANALYSIS

  • 120m barrels to be released by IEA member states.
  • Dollar continues upside move.
  • Ascending triangle support zone under consideration.

Brent Crude Oil Opens Higher While Markets Await Re-Test of $100 Level

CRUDE OIL FUNDAMENTAL BACKDROP

Brent crude extended its bearish trajectory this morning after the International Energy Agency (IEA) outlined details around its member states coordinated strategic release to quell soaring crude oil prices and increase global supply. A list of the countries involved along with their respective contributions are tabled below:

COUNTRY

BARRELS (1000S)

US

60559

Japan

15000

South Korea

7230

Germany

6480

France

6047

Italy

5000

UK

4408

Spain

4000

Turkey

3060

Poland

2298

Australia

1608

Netherlands

1600

Greece

624

Hungary

531

New Zealand

486

Ireland

451

Finland

369

Lithuania

180

Estonia

74

Source: Refinitiv

Since then, brent crude has hovered around the psychological $100/barrel mark after a failed break in mid-March.

In addition, an increasingly hawkish Federal Reserve has spurred the Dollar Index (DXY) higher towards the 100 mark weighing on crude oil (historically inverse relationship with oil). From the demand-side, China’s lockdown measures as a result of COVID-19 has hampered forecasts leaving oil prices open to further weakness.

Learn more about Crude Oil Trading Strategies and Tips in our newly revamped Commodities Module!

With the economic calendar fairly light today, the rest of the trading session going into the weekend will be driven by geopolitics as well as any unexpected fundamental oil news.

TECHNICAL ANALYSIS

BRENT CRUDE (LCOc1) DAILY CHART

daily brent crude chart

Chart prepared by Warren Venketas, IG

After breaking below the symmetrical triangle pattern (black) crude oil price action. now seeks to push below the $100/barrel key area of confluence which has developed the symmetrical into what seems an ascending triangle with a firm line in the sand (red) delineating triangle support. Traditionally, the descending triangle is a bearish continuation pattern, and with fundamentals positioned against crude oil, the pattern may well unfold as expected. This being said, in the medium/long-term I foresee the recent deployment by the aforementioned IEA member states as a short-term solution to a long-term problem as mentioned in my interview with IGTV earlier this morning.

Key resistance levels:

  • $120.50
  • $109.03/20-day EMA (purple)
  • 50-day EMA (blue)

Key support levels:

  • $100
  • 100-day EMA (yellow)
  • $95.59
  • $91.83

IG CLIENT SENTIMENT: MIXED

IGCS shows retail traders are marginally NET LONG on Crude Oil, with 65% of traders currently holding long positions (as of this writing). At DailyFX we typically take a contrarian view to crowd sentiment however, after recent changes in positioning the bias remains uncertain.

 

Apr 8, 2022 |  DailyFX
Warren Venketas, Analyst

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • General Statistics

    • Total Topics
      20,031
    • Total Posts
      88,040
    • Total Members
      69,025
    • Most Online
      7,522
      10/06/21 10:53

    Newest Member
    daisycarro3
    Joined 29/09/22 05:18
  • Posts

    • Elliott Wave Analysis TradingLounge Daily Chart, 29 September 2022, Binance Coin(BNBUSD) BNBUSD Elliott Wave Technical Analysis Function: Fol ow trend Mode: Motive Structure: Impulse Position: Wave ((3)) Direction Next higher degrees: Wave III of Motive Details: Wave II may have finished and the price is rising on wave III. Wave Cancel invalid level: 257.3 Binance Coin(BNBUSD) Trading Strategy: Bul Market Efforts The price tends to trade above the 326.8 level, and it This could be an opportunity to open a long position.but must not return below 257.3 Binance Coin(BNBUSD)Technical Indicators: MACD and MACDHistogram has a Bullish divergence, and the price has an opportunity reversal. TradingLounge Analyst: Kittiampon Somboonsod Source: Tradinglounge.com Get trial here!       Elliott Wave Analysis TradingLounge 4H Chart, 29 September 2022, Binance Coin(BNBUSD) BNBUSD Elliott Wave Technical Analysis Function: Fol ow trend Mode: Motive Structure: Impulse Position: Wave ((3)) Direction Next higher degrees: Wave III of Motive Details: Wave II may have finished and the price is rising on wave III. Wave Cancel invalid level: 257.3 Binance Coin(BNBUSD) Trading Strategy: Bul Market Efforts The price tends to trade above the 326.8 level, and it This could be an opportunity to open a long position.but must not return below 2666.2 Binance Coin(BNBUSD)Technical Indicators: The price is above the MA200, and MA50 line. MACD is above the zero line momentum is bullish.
    • Bitcoin BTC-USD Elliott Wave Technical Analysis TradingLevels. Price Prediction Today - TradingLounge Bitcoin Headline News:Grayscale's GBTC Discount to NAV Breaks Records as Spread Widens by More Than 35% Crypto Market Summary Bitcoin Elliott Wave Analysis:  Corrective rally See video Analyst Peter Mathers TradingLounge™ Australian Financial Services Licence - AFSL 317817 Source: tradinglounge com  TRIAL Buy 1 Month Get 3 Months    
    • DAX Performance Index ^GDAXI INDEXDB: DAX 40 Chart and Forecasts. FTSE 100 Index, EURO STOXX 50, Forex EURUSD GBPUSD DXY Dollar Index Elliott Wave Technical Analysis European Stock Market Daily News Headlines:Bonds Rally Across Globe After BOE Moves to Buy Debt Market Indices Overview: The corrective rally Wave 4 Elliott Wave Trading Strategy: Short Wave c) of 4 late Thursday or Friday Video Chapters 00:00 DAX 40 (GDAXI)  08:23 EURO STOXX 50 09:40 UKX / FTSE 100  10:50 Forex GBPUSD / EURUSD / DXY  15:14 Thanks for watching! Analyst Peter Mathers TradingLounge™ Australian Financial Services Licence - AFSL 317817 Source: tradinglounge com    
×
×
  • Create New...