A risk-on mindset returns to the commodity space as Brent, trading at $83.60, looks to surge towards $85 and beyond. High demand coupled with oil shortage has made sure bulls take charge and drive up oil prices.
The Baker Hughes report on the Total Rig Count failed to impact the market sentiment despite reporting an uptick in inventory.
The indicator added five units in the previous week and reached 433, higher than a year before. However, given the current growing demand for energy, this uptick in supply did not affect oil prices.
Technical Outlook
On the 4-hour chart, Brent initially finished another ascending structure at 83.60 and formed a new consolidation range below the level.
Later, it broke through the resistance and rallied to 85.00. At the time of writing, Brend has pulled back and currently trades near 83.40 levels.
After consolidating at current levels, Brent could rally past the resistance at 85.00 with the target at 87.50.
The MACD Oscillator's signal line moves above 0 within the histogram area and may continue growing towards new highs.
As we can see in the 1-hour chart, after completing another ascending structure at 83.60 and forming a new consolidation range below this level, Brent is moving up, looking to break past 84.00.
Possibly, the asset may rally and reach the target at 85.00. The Stochastic Oscillator indicates its signal line moves above 80 and may fall to 50. After that, the line may rebound from that level and surge towards new highs.
Disclaimer: Any forecasts contained herein are based on the author's particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.