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Oil Ready to Go Higher Amid Growth Drivers

By Dmitriy Gurkovskiy, Chief Analyst at RoboForex
 
Early in the last week of June, Brent continues rising. On Monday, the asset is trading at $76.10 and may easily go higher. There are at least two drivers for this.
 
The first driver is an unbridled enthusiasm of investors, who believe in extremely active global demand for energies as the world’s economies continue recovering. It is indeed the case but there won’t be a V-shaped growth – every country is fighting the pandemic in its own rhythm, which depends on a lot of factors, that’s why the demand for energies may grow inconsistently.
 
The second factor that supports bulls lies in a possible supply shortage, which may be 2.5-3 million barrels per day. In this case, it’s quite clear why oil has been rising for five weeks in a row.
 
In this light, it will be very interesting to follow the July meeting of OPEC+, where they may once again discuss possible expansions of the oil extraction.
 
In the H4 chart, after breaking 74.45 to the upside, Brent is still forming the ascending wave and may soon reach 76.35. Later, the market may correct to test 74.45 from above and then resume trading within the uptrend with the target at 78.00. From the technical point of view, this scenario is confirmed by MACD Oscillator: its signal line is moving below 0 and may re-enter the histogram area, thus confirming a further uptrend on the price chart.
 
Brent
 
As we can see in the H1 chart, after rebounding from 74.45, Brent continues trading upwards and forming the third ascending structure towards 76.53. After that, the instrument may correct to return to 74.45 and then resume trading upwards with the target at 77.50. From the technical point of view, this idea is confirmed by the Stochastic Oscillator: after returning to 20, its signal line is expected to rebound and resume growing to break 50. Later, the indicator may continue moving towards 80.

Brent

Disclaimer
Any forecasts contained herein are based on the author's particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

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Monday, 28 Jun, 2021 / 11:58

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Source : https://roboforex.com/

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