Crude Oil Market Analysis

[Solid ECN]

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Crude Oil - Growth is possible.​

On the daily chart, the upward wave C develops, within which the first wave 1 of (1) of C formed, and a downward correction ended as the second wave 2 of (1) of C, within which the wave c of 2 formed. Now, the development of the third wave 3 of (1) has started, within which the first entry wave of the lower level (i) of i of 3 has formed, a local correction has ended as the wave (ii) of i of 3, and the wave (iii) of i of 3 is developing.

If the assumption is correct, the asset will grow to the area of 110.40–119.65. In this scenario, critical stop loss level is 88.82.

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[Solid ECN]

Crude Oil - Growth is possible.​

On the daily chart, the first wave of the higher level (1) formed, the downward correction ended as the second wave (2), and the development of the upward third wave (3) started. Now, the first entry wave of the lower level i of 1 of (3) is developing, within which the wave (iii) of i is forming.

If the assumption is correct, the asset will grow to the area of 103.83 – 115.12. In this scenario, critical stop loss level is 82.2.

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[Solid ECN]

US Crude Oil​

Yesterday, the oil traders were testing the Additional Zone 90.2 – 90.01. The zone was held up, and the price reached the Gold Zone 92.88 – 92.51, the trend resistance. The oil traders also tried to break this zone upside, but failed.

The price is now trading in the correction and testing the new Additional Zone 91.03 – 90.85. The AZ is the strong support level, where one could enter new purchases according to the pattern with a target at yesterday’s high.

If the AZ is broken out, the correction will continue down to the Intermediary Zone 89.16 – 88.78.

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• Buy Zone 91.03 - 90.85 | Take Profit: 92.88 | Stop Loss: according to the pattern rules.​
• Buy Intermediary Zone 89.16 - 88.78 | Take Profit: 92.88 | Stop Loss: according to the pattern rules.​

 

[Solid ECN]

Crude Oil - A fall is possible.

On the daily chart, a downward correction forms as the second wave of the higher level 2, within which the wave c of 2 develops. Now, the third wave of the lower level (iii) of c has formed, a local correction has ended as the fourth wave (iv) c and the development of the fifth wave (v) of c has started.

If the assumption is correct, the price of the asset will fall to the area of 77.50 – 62.55. In this scenario, critical stop loss level is 100.87.

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[Solid ECN]

Crude Oil - A fall is possible.

On the daily chart, the first wave of the higher level (1) formed, and a downward correction develops as the second wave (2), within which the wave А of (2) forms. Now, the fifth wave of the lower level v of A is forming, within which the wave (iii) of v is developing.

If the assumption is correct, the price of the asset will fall to the area of 67 – 52.25. In this scenario, critical stop loss level is 90.30.

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[Solid ECN]

Crude Oil Price Suffers Strong Losses

Crude oil price ended last Friday with strong negativity to settle at 76.05 level, starting today with additional strong decline to break the mentioned level and reach 74 areas now, which pushes the price to suffer more expected losses in the upcoming period, opening the way to head towards 72.60 areas as a next main station.

Therefore, the bearish bias will be expected for today, supported by the negative pressure formed by the EMA50, taking into consideration that breaching 76.05 will stop the suggested decline and lead the price to attempt to recover again.

The expected trading range for today is between 72 support and 75.7 resistance, and the expected trend for today is Bearish.​

 

[Solid ECN]

Crude Oil - EU countries again did not agree on the maximum price level for oil from Russia

Representatives of the EU countries could not agree on the limitation of prices for Russian oil. According to one of the diplomats, the reason was the position of the representatives of the Polish delegation, which again refused to agree, demanding a significant reduction in the price ceiling from the current offer of 65.0–70.0 dollars per barrel since now this limit does not hinder exports in any way and will not significantly pressure on the Russian budget. Also, according to yesterday's data, the cost of a barrel of Urals oil was 51.96 dollars. As for the deal itself, the market has less and less confidence that all participating countries will finally accept it in the EU before December 5, when the restrictions provided for by the eighth package of sanctions, including the embargo on the supply of "black gold" from the Russian Federation by sea, will come into force.

On the daily chart of the asset, the trading instrument is moving within the downward corridor, approaching the resistance line, and the technical indicators maintain a stable sell signal, which does not rule out a local correction.

Resistance levels: 88.20, 95 | Support levels: 82.80, 77.5​

 

[Solid ECN]

Crude Oil - Trades near the year’s low

The key factor determining the direction of dynamics in the oil market remains the discussion of the maximum price level for Russian oil, which has not yet been agreed upon. Despite additional negotiations and consultations, the Baltic countries and Poland strongly oppose the introduction of a limit of 65.0–70.0 dollars per barrel, insisting on a range of 30.0–40.0 dollars per barrel. The desire of the leading European countries to set a limit is natural since, despite public statements about the refusal to purchase Russian energy resources, it is virtually impossible to do without them, and the high cost will allow them to hope that official Moscow will continue to supply energy resources further. However, yesterday, Deputy Prime Minister of the Russian Federation Alexander Novak denied this assumption, saying that the government would stop cooperating with countries that supported the new pricing mechanism and intended to work only on market conditions while not ruling out a possible reduction in oil production if the offer exceeded demand. The head of the International Energy Agency, Fatih Birol, also pointed to the fall in oil production in Russia and suggested that in the first quarter of 2023 it could reach –2.0M barrels per day.

On the daily chart of the asset, the instrument is moving around the year’s low of 76.00, slightly correcting upwards, and the technical indicators confirm the likelihood of a local correction, weakening the sell signal.

Resistance levels: 81, 86.6 | Support levels: 77.35, 73.65​

 

[Solid ECN]

Crude Oil - A fall is possible.

On the daily chart, a downward correction forms as the second wave of the higher level 2, within which the wave c of 2 develops. Now, the development of the fifth wave (v) of c has started, the wave i of (v) is developing, and the local correction is forming as the wave ii of (v).

If the assumption is correct, the price of the asset will fall to the area of 72.50 – 62.55. In this scenario, critical stop loss level is 100.87.

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[Solid ECN]

Crude Oil - A fall is possible.

On the daily chart, the first wave of the higher level (1) formed, and a downward correction develops as the second wave (2), within which the wave А of (2) forms. Now, the fifth wave of the lower level v of A is developing, within which the wave (iii) of v has formed, a local correction has ended as the wave (iv) of v, and the wave (v) of v is developing.

If the assumption is correct, the price of the asset will fall to the area of 67 – 52.25. In this scenario, critical stop loss level is 83.58.

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[Solid ECN]

Crude Oil - The downtrend in the oil market continues

All the factors operating on the oil market since the beginning of autumn have been preserved. First of all, this concerns the recent decision of OPEC+ to leave the current parameters for reducing the oil production by 2.0M barrels per day against the background of the expected supply surplus in 2022, which was indirectly confirmed by yesterday's statement by the Russian Deputy Prime Minister Alexander Novak, who announced an increase in oil production in the Russian Federation for eleven months by 2.2%, contrary to the negative forecasts of the International Energy Agency (IEA), which assumed a significant reduction in production in Russia by 10.87M barrels per day to 10.86M barrels per day. In turn, as part of the last meeting of the cartel on December 4, its participants decided to maintain current production plans, despite the introduction by Western countries of the ceiling price level for Russian energy resources at 60.0 dollars per barrel and the ongoing uncertainty in the market: demand may drop significantly from quarantine restrictions in China, and the proposal – if official Moscow decides to take retaliatory measures and stops supplying its resources to countries that supported the introduction of a new pricing mechanism.

On the daily chart, the trading instrument is moving around the year's low around 74, slightly correcting down, and the technical indicators confirm the high probability of further decline, strengthening the sell signal.

Resistance levels: 76.3, 81.5 | Support levels: 73, 65.41​

 

[Solid ECN]

Crude oil price faces solid resistance​

Crude oil price’s rally stopped at 75.63, which formed solid resistance against the price, accompanied by witnessing overbought signals through stochastic that might press on the price to rebound bearishly, while the EMA50 supports the price positively.

Therefore, the contradiction between the technical factors makes us prefer to stay aside until we get clearer signal for the next trend, noting that breaching 75.63 will lead the price to achieve additional bullish correction that its next target reaches 78.93, while breaking 74.85 will put the price under negative pressure that its targets begin by testing 74.05 followed by 72.60 levels.

The expected trading range for today is between 73.80 support and 77.30 resistance.​

 

[Solid ECN]

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Crude Oil - Price growth potential remains​

Prices were supported by three main factors: a likely increase in oil demand in China after a significant easing of coronavirus restrictions, fears of a reduction in supply on the market due to the introduction by the G7 countries of the price limit for Russian supplies of "black gold" and the response of official Moscow, as well as a slowdown in the pace of tightening of the monetary policy of the US Fed on against the background of signs of slowing inflation. So, the US regulator raised the interest rate by 50 basis percentage points instead of 75 basis percentage points, as it was earlier, which put pressure on the US currency and raised the price above 83.0 dollars per barrel.

Technically, the price is close to the middle line of the Bollinger Bands 83.2, the breakout of which will give the prospect of further growth to the levels 87.5 (Murray level [4/8]) and 90 (Fibo retracement 38.2%, Murray level [5/8]). The key for the "bears" remains the level of 77 (Fibo retracement 50.0%, Murray level [1/8]), consolidation below which can cause a further decline to the area of 75 (Murray level [0/8]), 71.88 (Murray level [-1/8]), 68.75 (Murray level [-2/8]).

Resistance levels: 83.2, 87.5, 90 | Support levels: 77, 75, 71.88, 68.75​

 

[Solid ECN]

Crude Oil - The price is in a correction, a fall is possible.​

On the daily chart, a downward correction develops as the second wave of the higher level 2, within which the wave c of 2 forms. Now, the development of the fifth wave (v) of c has started, within which the wave iii of (v) has formed, and a local correction is ending as the wave iv of (v).

If the assumption is correct, the price of the asset will fall to the area of 72.50 – 62.55. In this scenario, critical stop loss level is 89.80.

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[Solid ECN]

Crude Oil - Growth is possible.

On the daily chart, the first wave of the higher level (1) formed, and a downward correction develops as the second wave (2), within which the wave А of (2) formed. Now, the development of wave B of (2) has started, within which the wave of the lower level a of B is developing.

If the assumption is correct, the asset will grow to the area of 93.25 – 100.5. In this scenario, critical stop loss level is 70.05.

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[Solid ECN]

Crude Oil - the oil market is in a state of uncertainty​

Several opposing factors influence the energy market: investors' hopes for an increase in fuel consumption in China and a recovery in its economy next year, as predicted by OPEC and the International Energy Agency (IEA), contribute to the increase in the asset. Also, it is expected that official Moscow will legally prohibit oil sales to countries that support introducing a ceiling price level for Russian oil, leading to its shortage, primarily in the EU countries. To get out of this situation, Germany expected to use supplies from Kazakhstan. However, according to the calculations of PJSC Transneft, it is technically impossible to provide a sufficient volume of transportation. Finally, the start of oil purchases for the state reserve, announced by the US administration, supports the trading instrument: the process promises to be lengthy, as 180.0M barrels released to the market this year to stabilize prices will have to be compensated.

A significant strengthening of quotations and the formation of a medium-term uptrend are hampered by the continuing risks of a global recession, reinforced by the tightening of monetary policy by the world's leading regulators. Also, several experts believe that the easing of coronavirus restrictions by the Chinese authorities may have the opposite effect, and an increase in the incidence in the country may lead to the re-imposition of quarantine measures or cause the emergence of a new strain of COVID-19 and another wave of the pandemic around the world. The American Petroleum Institute (API) data on oil reserves published yesterday did not provide enough momentum for the price: a decrease in oil reserves by 3.069M barrels was offset by an increase in gasoline volumes by 4.5M barrels and an increase in distillate reserves by 0.828M barrels.

The trading instrument is near the middle line of Bollinger bands at 76.30. To resume growth, the price needs to break the zone 76.30–78.12, and then it will be able to reach the area of 81.25 (Murrey levels [2/8]) and 87.50 (Murrey levels [4/8], Fibonacci correction 61.8%). The key "bearish" level is 71.68 (Murrey levels [–1/8]), a breakdown of which will give the prospect of further decline to 68.75 (Murrey levels [–2/8]) and 64.60 (the area of November lows last year).

Resistance levels: 78.12, 81.25, 87.5 | Support levels: 71.88, 68.75, 64.6​

 

[Solid ECN]

Crude Oil - Oil reserves in the USA have sharply decreased again​

According to October statistics, the USA holds the lead with 11.971M barrels of oil, Saudi Arabia is in second place with 10.957M barrels, and Russia is in third place, which has significantly reduced production levels, which amounted to 10.66M barrels and is still higher than the 10.599M barrels recorded in August. During the period from January to October, energy production in the Russian Federation managed to increase by 2.4% from last year's figure to 443.2M barrels.

At the same time, oil reserves in the US strategic reserve continue to decline rapidly: last week the indicator adjusted by -3.6M barrels, amounting to 378.6M barrels, which is the lowest value since 1983. In addition, the US Department of Energy announced that in order to replenish the volumes put on the market, the purchase of energy will begin, and the first batch of 3.0M barrels will be delivered in February 2023.

On the daily chart of the asset, the price is trading within a descending corridor, being in the middle of the range. Technical indicators hold the sell signal, which has weakened somewhat recently

Support levels: 81.20, 75.80 | Resistance levels: 84.6, 89.4​

 

[Solid ECN]

Crude Oil Technical Analysis​

Crude oil price approached our waited target at 81.60 but it bounced downwards strongly to reach the key support 78.93, which urges caution from the upcoming trading, as continuing the negative pressure and breaking this level will stop the correctional bullish trend and push the price to suffer new losses on the intraday basis, while consolidating above it will lead the price to test 81.60 initially.

The expected trading range for today is between 78.60 support and 82.00 resistance.​