Context and Price Dynamics:
The price of Brent Crude Oil is showing a weak bearish momentum at the start of the week, retreating from the highs reached on September 6, and now testing the 71.20 level for a potential downside break. The market is on tenterhooks awaiting the outcome of the two-day U.S. Federal Reserve meeting, where a 25 basis point cut in the reference rate to 5.00% is anticipated, along with hints about future actions.
Impact of Hurricane "Francine":
Hurricane "Francine" has halted operations at several platforms in the Gulf of Mexico, pushing up oil prices. About 42.0% of the region's capacity was affected, which could reduce total U.S. extraction by 50,000–60,000 barrels per day.
Pressures on Price:
OPEC and the International Energy Agency (IEA) have downgraded previous oil demand estimates due to the slowdown in European and Chinese economies. August's macroeconomic statistics back these concerns, showing a decrease in China's industrial production and retail sales. Analysts point to a slower growth in oil demand than anticipated, partly due to China's transition to cleaner fuels and a reduction in gasoline demand in other developed countries.
Support and Resistance Levels:
On the daily chart, "Bollinger Bands" are firmly descending with an active narrowing of the price range, indicating a mixed trading dynamic in the short term. The MACD has reversed upward, forming a buy signal, while the Stochastic is nearing its highs, suggesting risks of overbuying in the very short term.
Resistance Levels: 72.00, 73.00, 74.00, 75.04.
Support Levels: 71.00, 70.00, 69.00, 68.00.
Trading Scenario:
Short Positions: Could be opened if the 71.00 level breaks downward, targeting 69.00, with a Stop Loss at 72.00. The execution timeframe is 1-2 days.
Long Positions: Could be opened if the price bounces from 71.00 and breaks the 72.00 level upwards, targeting 74.00, with a Stop Loss at 71.00.