The market lacks the directional impetus and is trading flat in the weekly charts. Oil traders are closely monitoring developments in geopolitics where the US-China trade talks come to the fore. Investors hope to see some progress in trade relations between the two countries despite the scandal surrounding Huawei. This, coupled with Saudi Arabia plan to cut production further helps oil prices to stay afloat.
But the current conditions don’t suggest a rally could take place in the market any time soon, unless there is a major breakthrough in trade negotiations, or a steep dollar sell-off after the FOMC meeting. Both scenarios are actually quite unlikel, so the upside potential in Brent will remain limited in the near term, while the risks are still present.
From the technical ponit of view, the $59 handle remains an important as a break below this level will make the technical picture worse. A daily close above $61 is needed for another run at the $62 barrier.