Crude oil rebound limited, still down!
WTI crude oil rebounded sharply on Monday (Oct 21) during European trading hours, as traders look to establish new support levels after a sharp 7% drop last week. Last week was the market's worst weekly performance since early September, amid concerns over demand and as concerns over supply disruptions in the Middle East eased.
Weak oil demand
Despite the weak data, Saudi Aramco's chief executive remained "quite bullish" on Chinese oil demand, citing stimulus measures and rising demand for jet fuel.
Geopolitical Implications
On the geopolitical front, Israeli Prime Minister Benjamin Netanyahu said last week that they will not attack Iranian non-military facilities, signaling that Iran's oil and nuclear facilities are secure, which reduced concerns over supply disruptions.
Market outlook: Narrow range with bearish pressure
Oil prices are expected to remain rangebound in the near term as traders weigh technical resistance levels against the uncertain demand outlook. Upside potential remains limited until price breaks above the key moving average. The weak demand outlook, coupled with rising US production and concerns about the global economy, suggests a bearish market bias and oil prices could test lower support if current technical levels fail to hold.
Crude oil prices are showing more bullish elements and are close to testing the $70.58 level, a level that represents the first resistance position on the upside.
On the downside, the target is to first break below $68.65 to confirm continuation of the bearish trend and then move towards $67.00,
A bearish trend continues to be recommended for the coming period due to the negative impact of the double top pattern. Today's expected trading range is between support at $67.75 and resistance at $70.75.
Trend forecast: Bearish
Weak oil demand
Despite the weak data, Saudi Aramco's chief executive remained "quite bullish" on Chinese oil demand, citing stimulus measures and rising demand for jet fuel.
Geopolitical Implications
On the geopolitical front, Israeli Prime Minister Benjamin Netanyahu said last week that they will not attack Iranian non-military facilities, signaling that Iran's oil and nuclear facilities are secure, which reduced concerns over supply disruptions.
Market outlook: Narrow range with bearish pressure
Oil prices are expected to remain rangebound in the near term as traders weigh technical resistance levels against the uncertain demand outlook. Upside potential remains limited until price breaks above the key moving average. The weak demand outlook, coupled with rising US production and concerns about the global economy, suggests a bearish market bias and oil prices could test lower support if current technical levels fail to hold.
Crude oil prices are showing more bullish elements and are close to testing the $70.58 level, a level that represents the first resistance position on the upside.
On the downside, the target is to first break below $68.65 to confirm continuation of the bearish trend and then move towards $67.00,
A bearish trend continues to be recommended for the coming period due to the negative impact of the double top pattern. Today's expected trading range is between support at $67.75 and resistance at $70.75.
Trend forecast: Bearish
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