Oil broke its three-month losing streak and posted a three-month winning streak. OPEC+ production cut and reopening economies are supported prices.
Over this year, the oil prices weakened from the strong position it enjoyed early on, slipping to a sub-20 level. Since 22 April low, the price rallied more than 170% buy still 33% down from this year’s opening levels. In the first half of 2020, OPEC+ production cuts made a significant contribution to push the oil price above $40 per barrel.
Earlier support has changed to resistance. The Brent oil price needs to cross and close above $44.25 to print another high at $46.00 an $49.50.
Crude oil prices have begun the brand-new week on a positive note but failed to breach early June high. The price may trade in a narrow range between $44.25-$37.00.
Let’s now take a look at the daily chart. You can see the price made a decent advance from 22 April through May. The price consolidated for eight trading sessions and change the course to the North again until 08 June. Since then, the price action caught in a narrow range. The near-term support finds at $39.60 below here focus on $37.00. A breakdown and close below $37 mean a distribution pattern start the action that could lead to a decent pullback. Since April low, the price has been contained in the ascending channel. Whereas since mid-June, the price action breaks the channel lower end, suggesting the near-term price reversal. So, keep the focus on the current narrow range.
The week ahead, Russia published its oil production data, price-sensitive data. In early June, oil ministries from the OPEC and other oil-producing countries led by Russia reached an agreement to continue cutting 9.7MB per day through July.
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