General analysis Brent for 11.10.2021
Current Dynamics
Today Brent is trading above the 84.00 level for the first time since October 2018. The driver of the hydrocarbons market is still the global shortage of energy supplies. First of all, the demand for oil is formed on the background of rising prices for natural gas. In addition, the participants of the OPEC+ agreement refused to increase production in October and November, which provides long-term support to the oil market.
At the same time, the US oil producers took advantage of the high price by increasing the number of active gas and oil drilling rigs in the country. It is also worth noting the increase in inventories of the main oil products in the US, however, this fact can not stop the upward potential of oil. Rising energy prices may increase price pressure which will have a negative impact on personal expenses indicator. It is worth considering that the high price of "black gold" brings risks not only for transportation but also for the production of consumer goods. As a result, if the hydrocarbons market maintains its current dynamics, the forecasts for inflation, economic growth, and monetary policy will have to be revised for all major economies.
On Wednesday at 22:30 (GMT+2), the API will release a report on weekly changes in commercial oil inventories.
Support and resistance levels
On the 4-hour chart, the instrument is testing the upper boundary of Bollinger Bands, which acts as a key resistance level. The indicator is directed upward and the price range is widening, which indicates that the current trend continues. MACD histogram is holding a strong buy signal. Stochastic is preparing to leave the overbought area, a strong sell signal is expected within 1-3 days.
- Support levels: 78.20, 79.50, 81.50, 82.80.
- Resistance levels: 84.40, 85.00, 85.35, 86.60.
Trading scenarios
- Long positions can be opened at the current price with a target of 85.80 and a stop loss at 81.50. Implementation period: 1-3 days.
- Short positions should be opened below the level of 82.50 with a target of 80.00 and a stop-loss at the level of 83.70. Implementation period: 1-2 days.