On Friday, futures for Brent crude continued to trade above $75 per barrel. This increase was more than 3% compared with the previous session due to several factors, including lower interest rates in China and the suspension of monetary tightening by the US Federal Reserve. These developments have strengthened the prospects for oil demand in the two largest consumers of this resource in the world.
The International Energy Agency, in its latest monthly report, announced a forecast for global oil demand to grow by 6% between 2022 and 2028. It also supported the oil market. The dollar’s decline also had a positive impact on oil prices, as the depreciation of the dollar makes oil more accessible to holders of other currencies and encourages risk-taking in the markets.
However, investors remain cautious in light of global economic uncertainty. Weak economic data from China and further rate hikes by other major central banks create some uncertainties for the future outlook. For example, the European Central Bank recently raised interest rates by another 25 basis points to combat high inflation. These factors influence the oil market and cause serious caution among investors.
BRENT Weekly Forecast June 19 — 23, 2023
Quotes of BRENT oil complete the trading week near the area of 75.75 dollars per barrel. The asset continues to move within the correction and the downward channel. Moving averages indicate a bearish trend. Prices have gone down from the area between the signal lines, which indicates pressure from sellers of raw materials and a potential continuation of the decline already from current levels. At the moment, we should expect an attempt to develop a decline and test the support area near the level of 70.65. Then, it is worth considering a rebound upwards and the continuation of the growth of oil in the area above the level of 89.05 dollars per barrel.
An additional signal in favor of rising oil prices this week will be a test of the support line on the relative strength index (RSI). The second signal will be a rebound from the support area on the price chart. Cancellation of the option of raising quotes and prices for BRENT oil in the trading week June 19-23, 2023 will be a fall and a breakdown of the level of 66.05. This will indicate a breakdown of the support area and a continuation of the fall of oil to the area below the level of 55.05. With the breakdown of the resistance area and the closing of quotes above the level of 80.55, we should expect confirmation of the rise in the price of BRENT oil, which will indicate a breakdown of the upper limit of the downward channel.
BRENT Weekly Forecast June 19 — 23, 2023 suggests an attempt to test the support area near the level of 70.65. Where should we expect a rebound and an attempt to continue the growth of oil with a potential target at the level of 89.05. An additional signal in favor of rising oil prices will be a test of the trend line on the relative strength index (RSI). Cancellation of the growth option will be a price drop and a breakdown of the 66.05 area. This will indicate a breakdown of the support area and a continued fall in the price of oil with a target below the level of 55.05.
