The Coming Oil Market Storm
In the nearest future, the oil market will become more and more dramatic. At least, the current fundamental background, which is more favorable for the bulls but not the bears, is pointing at that.
This time, investors barely noticed the statistics on the Oil Rig Count from Baker Hughes over the last week. The indicator improved by 5 units after it had been going down for two previous weeks. This is due to the fact that the reports on the API Crude Oil Stock Change and the EIA Crude Oil Stocks Change offered rather mixed numbers: the first one showed that the indicator continued falling, the second one indicated a rebound.
Your capital is at risk
However, all eyes of investors are focused not on numbers, but the fundamental background. If to be more specific, on the relations between the USA and Iran, which become more intense. The USA demands Iran to stop importing oil and appeals to global buyers not to acquire “black gold” of the Iran origin. The point of all of this is an economic warfare against Iran and this plan actually might work, because most of the buyers wouldn’t want to disagree with the USA and Donald Trump.
In the future, this might reduce the world oil stock to such a level, when any piece of news, even the least significant one, will be enough to make oil prices extremely volatile.
The “epoch date” for the USA is November 4th, which means that the burst of activity with oil prices may occur from September to November.
As we can see in the H4 chart of Brent, after breaking the resistance level, the instrument has started a new uptrend. The main upside target is the current resistance line and 83.00. The short-term scenario indicates that the downtrend is nothing but a correction of the previous rising impulse. If the pair breaks the local resistance line at 78.58, it may continue growing towards the next one at 79.80. However, one can’t exclude a possibility that the downtrend may yet continue. The local support level is at 76.37. If the price breaks it, the instrument may continue falling towards 75.00.
This article was written by Dmitriy Gurkovskiy, a Chief Analyst at RoboForex