BRENT CRUDE OIL: THE QUOTES ARE UNSTABLE AMID STATEMENTS BY THE US SECRETARY OF ENERGY
| Scenario | |
|---|---|
| Timeframe | Weekly |
| Recommendation | BUY STOP |
| Entry Point | 86.60 |
| Take Profit | 89.50 |
| Stop Loss | 85.50 |
| Key Levels | 82.50, 85.00, 86.60, 89.50 |
| Alternative scenario | |
|---|---|
| Recommendation | SELL STOP |
| Entry Point | 85.00 |
| Take Profit | 82.50 |
| Stop Loss | 86.00 |
| Key Levels | 82.50, 85.00, 86.60, 89.50 |
Current trend
Prices for benchmark Brent Crude Oil are correcting, trading just below the 86.00 level, reacting to statements by US Energy Secretary Jennifer Granholm that by the end of this year, it is planned to replenish the strategic reserve. Note that during the release of oil in 2022–2023 storage emptied by more than 180.0M barrels, which is not comparable to the volume of purchases from the beginning of the year. According to the official, the country has already purchased 30.0M barrels, and the United States will need at least another 150.0M barrels within nine months, that is, an average of 16.0–17.0M barrels per month, although the average monthly level domestic production does not exceed 13.0M barrels. Thus, oil import will be required, however, considering the voluntary reduction in production by OPEC countries, oil volumes on the world market are insufficient. Traders are expecting new data next month to clarify the situation and shape a long-term trend.
Local dynamics support the asset, as oil reserves last week, according to a report from the American Petroleum Institute (API), fell by 1.519M barrels after a decline of 5.521M barrels earlier, and according to statistics from the US Department of Energy Information Administration (EIA) – by 1.952M barrels after a decrease of 1.536M barrels.
Support and resistance
On the daily chart, the trading instrument is moving in a corrective trend, heading toward the resistance line of the ascending channel of 89.00–82.00.
Technical indicators support the correction, maintaining a buy signal: fast EMA of the Alligator indicator are above the signal line, and the AO histogram forms corrective bars in the buy zone.
Resistance levels: 86.60, 89.50.
Support levels: 85.00, 82.50.
Trading tips
Long positions may be opened after the price rises and consolidates above 86.60, with the target at 89.50. Stop loss – 85.50. Implementation period: 7 days or more.
Short positions may be opened after the price declines and consolidates below 85.00, with the target at 82.50. Stop loss – 86.00.
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