🥇 First rule of investing? Know when to save! Up to 55% off InvestingPro before BLACK FRIDAYCLAIM SALE

Brent Crude Oil Steadies but May Be Vulnerable to Fresh Spikes

Published 08/30/2023, 12:48 AM
LCO
-
BCO/USD
-
  • Oil prices stabilize after establishing a new range
  • Hurricane season may have a greater influence amid a tight market
  • Head and shoulder neckline remains intact
  • Oil prices appear to be stabilizing around the middle of their new higher range, in the aftermath of OPEC+ cuts (voluntary Russia and Saudi in particular).

    Brent crude currently sits a little shy of $85 after rebounding higher off $82 last week and peaking just above $88 earlier this month.

    There remains considerable uncertainty around the outlook for the global economy, from China’s sluggish rebound to interest rates and possible recessions elsewhere. But on the supply side, major producers appear committed to ensuring the market remains tight and prices higher.

    They had little success earlier in the summer but that is no longer the case and the market is now vulnerable to spikes on the back of surprise outages and hurricane-related issues in the US.

    Head and shoulders neckline remains key

    The failure to break the neckline of the head and shoulders last week suggests there’s plenty of support for Brent following on from what was a potentially very bullish move just a month ago.

    BCOUSD Daily

    BCOUSD Daily Chart

    Source – OANDA on Trading View

    The break above the 200/233-day simple moving average band was the first time in almost a year that the price had traded above it. Whether that is now failing or the price is naturally stabilizing having been heavily manipulated on the supply side, only time will tell.

    If it had in fact turned bearish, the neckline may have fallen, at which point we could have seen a decent corrective move, based on the size of the pattern. Instead, it’s edging higher and a move above the right shoulder could be seen to weaken or break the pattern altogether.

    Original Post

Latest comments

Loading next article…
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.