Crude prices continue to rally as Brent crude benchmark prices rose to $89.04 per barrel on Wednesday, almost erasing the plunge of crude prices since 2014.
Crude prices rose after Yemen's Houthi group attacked the United Arab Emirates rising fears over further supply tightening. The attack further escalated hostilities between the Iran-aligned group and a Saudi Arabian-led coalition.
Many analysts are upgrading their forecast for crude prices. Goldman Sachs expects Brent cured prices to hit $100 per barrel in the third quarter of 2022. Oil producers are lagging behind to satisfy the increasing demand, which also support prices.
If we look at crude prices 7-8 years ago, we may see a strong resistance at $94.50-95 per barrel and there are no significant resistance levels before that. U.S. crude inventories traditionally published on Wednesday this week will be released on Thursday as the United States celebrated Martin Luther King Day this Monday. According to the forecast crude inventories may fall by 1.367 million barrels on the previous week making it the eights in a row in terms of falling crude inventories.
Technically speaking the existing upward trend that started December 20 last year has a very steep angle that may mean an easier change of the trend. The support level for crude prices is within $86.40-86.50 per barrel area, and since prices are above this level the upside movement has the upper hand.However, we may soon see a slight correction of Brent crude prices to the $86.40-86.70 area, where the recent October 2020 peak is located.
Traders should be cautious to open any buy operations close to the new highs at the markets is seen overheated. To open buy positions it would be wise to use any corrections to the strong support levels.
Crude prices rose after Yemen's Houthi group attacked the United Arab Emirates rising fears over further supply tightening. The attack further escalated hostilities between the Iran-aligned group and a Saudi Arabian-led coalition.
Many analysts are upgrading their forecast for crude prices. Goldman Sachs expects Brent cured prices to hit $100 per barrel in the third quarter of 2022. Oil producers are lagging behind to satisfy the increasing demand, which also support prices.
If we look at crude prices 7-8 years ago, we may see a strong resistance at $94.50-95 per barrel and there are no significant resistance levels before that. U.S. crude inventories traditionally published on Wednesday this week will be released on Thursday as the United States celebrated Martin Luther King Day this Monday. According to the forecast crude inventories may fall by 1.367 million barrels on the previous week making it the eights in a row in terms of falling crude inventories.
Technically speaking the existing upward trend that started December 20 last year has a very steep angle that may mean an easier change of the trend. The support level for crude prices is within $86.40-86.50 per barrel area, and since prices are above this level the upside movement has the upper hand.However, we may soon see a slight correction of Brent crude prices to the $86.40-86.70 area, where the recent October 2020 peak is located.
Traders should be cautious to open any buy operations close to the new highs at the markets is seen overheated. To open buy positions it would be wise to use any corrections to the strong support levels.
