Brent oil faces modest growth amid mixed market signals

it shows a slight increase on Tuesday, at a price of about 83.57 dollars per barrel. The market remains near two-month lows, caught between optimism for a peaceful resolution to the Middle East conflict and concerns over U.S. crude stockpiles.

The main focus of the exchange currently revolves around the ongoing negotiations between Israel and Hamas, facilitated by Egypt. However, these talks have reached an impasse and there are renewed signs of conflict from both sides. Israel has expressed its displeasure, saying the terms offered do not meet its requirements, thus complicating diplomatic efforts.

Despite these challenges, the ongoing conflict in the Middle East is helping to support energy prices due to fears of potential disruptions in the supply of raw materials. On the demand side, Saudi Arabia recently raised its oil selling prices to Asian buyers, indicating expectations of robust demand, particularly during the coming summer. This adjustment is often seen when a producer is confident of rising demand, with Saudi Arabia likely banking on strong consumption from China, the world’s top oil importer.

Brent Technical Analysis

On the H4 chart, Brent hit the local bullish target at 91.50. The correction towards 82.70 is nearing completion and we anticipate the formation of a consolidation range above this level. If the price breaks above this range, a new uptrend towards $95.00 could be initiated. This bullish scenario is supported technically by the MACD indicator, which shows the signal line at lows below the zero mark, indicating potential upside to new highs.

On the H1 chart, the structure of the fifth corrective wave at 82.70 has been formed. A consolidation range has developed above this level and we expect a bullish link to 84.44. If this level were to be breached, it could open the potential for a bullish wave to 85.70, which is the initial target. This technical outlook is corroborated by the stochastic oscillator, with the signal line above 20 and poised to climb to 80.

By the RoboForex analysis department

Disclaimer
Any forecast contained herein is based on the author’s own opinion. This analysis cannot be treated as trading advice. RoboForex assumes no responsibility for trading results based on trading recommendations and reviews contained herein.