Technical Analyst, Saxo Bank Group
Summary: Brent and WTI crude oil bounced from key support but seems to be running out of steam. Down trend could resume and support could again come under pressure. Where to next if taken out?
Short- and medium-term technical outlook
Brent Crude oil seems to be rejected at the 0.382 retracement of the April sell-off at around 77.46.
Trend is down on both short and medium- term.
Weekly chart shows how 200 weekly Moving Average is a strong support currently just above 70 USD.
IF Brent closes below 70 medium-term downtrend has resumed and a sell-off down to support at around 64.97. But a spike down to the 0.618 retracement of the 2020-2022 Bull market at around 63.02 could be seen. That level is also the 1.382 projection of the Q2 2023 correction at 63.48.
If Brent closes below 70 RSI will also close back below 40 threshold adding to the bearish picture. If Brent is closing a week below 64.97 there could be further downside to 59-50
To reverse the short-term bearish trend a close above 83.06 is needed. To reverse the medium-term trend a close above 87.50 is needed.
WTI Crude oil bounced from March spike down and now seems to be rejected at the 0.50 retracement of the April sell-off at 73.61. RSI is still in negative sentiment and sellers could resume control.
Medium-term WTI seems to be in a limbo. It did perform a higher high April but RSI is still in negative sentiment. If WTI closes below 63.69 next support is at around 57.25 If that support is taken out a sell-off down to around 45 could be seen.
To reverse the short-term bearish trend a close above 76.92 is needed. For WTI to confirm a bullish trend medium-term a close above 83.53 is needed.
A new fragmented world order can render some of today's infrastructure obselete, but it also calls for massive new investments across the globe, which requires a new set of strategic and tactical investment strategies.
Steen Jakobsen,
Chief Investment Officer
As globalisation turns to fragmentation, China seems set on playing a role in the global economy, while simultaneously working towards proofing its own economic situation from external shocks and crises.
Redmond Wong,
Market Strategist
The recent bank runs and ensuing challenges are reminicent of something we've seen before. Will it end like the S&L crises of 1986 and 1995?
Chris Dembik,
Head of Macroeconomic Research
Equity markets need to recalibrate to another - fragmented - global world. What's your view on equities in this market - are they going up or down?
Peter Garnry,
Head of Equity Strategy
With every development comes new opportunites, some of which could be in India. Have you considered the country as a part of your diversification strategy?
Charu Chanana,
Market Strategist
A collar is an option strategy that allows some protection while maintaining some upside potential. What investment would you like to use a collar strategy for?
Hans Oudshoorn,
Trainer Academy
There are arguments to be made for many commodities to have upside. Which are you paying the most attention to this quarter?
Ole S. Hansen,
Head of Commodity Strategy
In a very challenging macro environment, which currencies do you think will come out on top?
John J. Hardy,
Head of FX Strategy
Disclaimer
The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.
Please read our disclaimers:
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
- Full disclaimer (https://www.home.saxo/en-gb/legal/disclaimer/saxo-disclaimer)