The commodity market is correcting early in another week of February. Brent is currently falling towards $93; the instrument remains influenced by market expectations of the global oil supply increase.
Investors continue watching the US-Iran nuclear deal. The rumor has it that the parties are getting closer to a decision and may reach a consensus on several topical issues. It means that oil from Iran may soon appear on the commodity market and eliminate the supply shortage.
Oil could have fallen much deeper, but geopolitical tensions prevented further decline. Last Friday’s report from Baker Hughes showed that the Oil Rig Count in the US added four units, up to 520. If compared with a 19-unit addition the week before, one can say that the tendency is slowing down.
In the H4 chart, having completed the correction at $90.44, Brent has finished the ascending impulse towards $94.19. Possibly, the asset may correct down to $92.35. After that, the instrument may resume growing to break $94.40 and then continue trading upwards with the short-term target at $99.00.
From the technical point of view, this scenario is confirmed by MACD Oscillator: its signal line is moving below 0 outside the histogram area. Later, the line is expected to grow and break 0, thus indicating a further uptrend in the price chart.
As we can see in the H1 chart, after rebounding from $94.77 and finishing another correctional structure at $90.50, Brent has completed the ascending impulse towards $94.19; right now, it is forming a new consolidation range below the latter level.
Possibly, today the asset may correct towards $92.35 and then resume growing to reach $96.60. Later, the market may fall to return to $94.40 and then form one more ascending structure with the target at $99.00.
From the technical point of view, this idea is confirmed by the Stochastic Oscillator: after returning to 50 and breaking it to the downside, its signal line is expected to continue falling towards 20. After that, the line may resume its growth to reach 80.
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.