Crude Oil Holds Range as Weak Demand and Fed Uncertainty Weigh on Outlook

Oil prices consolidate as markets digested a mix of supply and policy signals. Brent oil (BCO) consolidates around $65, while WTI oil (CL) trades below $62. OPEC+ agreed to a small output hike of 137,000 barrels per day in December. However, the group also announced it would pause further increases in early 2026, which helped cap downside pressure.

The strong U.S. dollar also weighed on crude oil prices by making them more expensive for global buyers. Meanwhile, oil demand remains fragile as global manufacturing continues to face persistent headwinds. Additionally, uncertainty surrounding the Fed’s interest rate policy adds to the volatility in oil prices.

Meanwhile, U.S. threats of military action in Nigeria, a significant oil producer, have added to geopolitical uncertainty. While prices remain steady for now, the market faces a fragile balance between supply risks and weak demand signals.

WTI Crude Oil Technical Analysis

WTI Oil Daily Chart – Consolidation

The daily chart for WTI crude oil shows that prices continue to consolidate below the 50-day SMA. The price is hovering around the $60 to $62 area after rebounding from the $55 support. This consolidation reflects market uncertainty, with prices searching for direction.

However, the RSI remains above the mid-level, suggesting that a new move is developing. A break back above the 50-day SMA near $62 would signal further upside toward the 200-day SMA around $65. As long as prices stay below the $65 region, the outlook for oil remains bearish.

WTI Oil 4-Hour Chart – Negative Price Action

The 4-hour chart for WTI crude shows that the price is consolidating below the resistance near the $62 region. This consolidation reflects market uncertainty and a lack of clear direction.

However, the RSI remains well above the mid-level, confirming that prices are in a neutral zone. The indicator suggests that the market is waiting for a breakout to determine the next move.

Brent Crude Oil Technical Analysis

Brent Oil Daily Chart – Descending Broadening Wedge

The daily chart for Brent oil shows that the price has remained within a descending broadening wedge pattern since 2024. Strong long-term resistance is evident near the $75 level, and a break above this region is required to propel the price higher.

However, a break below the $60 area would trigger further downside pressure. Overall, the outlook remains negative as long as prices remain suppressed below the $75 resistance level.

The weekly chart for Brent crude oil shows that the price is consolidating below the black trendline near the $75 region. This consolidation below the 50-day SMA indicates market uncertainty. Moreover, the RSI remains below the mid-level, signalling that bearish pressure persists in Brent crude oil. A break below the $60 level would further strengthen the bearish outlook.

Brent Oil 4-Hour Chart – Rebound

The 4-hour chart for Brent crude oil shows that prices are consolidating below the $67 region and are seeking their next direction. The rebound from the $60 area looks constructive, but a break above $67 is needed to confirm further upside towards the $70 level. As long as the price remains below $67, the short-term bias leans bearish. A sustained move above $67 would shift the outlook to continued recovery.

US Dollar Index Technical Analysis

US Dollar Daily Chart – Key Resistance of 100.50 Level

The daily chart for the U.S. Dollar Index indicates that the index has continued to trend higher following the Fed’s recent rate cuts. Strong immediate resistance is seen near the 100.50 level, and a break above this point would confirm a short-term bullish breakout.

The key 100.50 level also aligns with the 50-day SMA, making it a critical zone to watch. However, the RSI is approaching overbought territory as the index nears the 100 level. This suggests that respecting this resistance could trigger a sharp pullback in the U.S. Dollar Index.

US Dollar 4-Hour Chart – Consolidation

The 4-hour chart for the U.S. Dollar Index shows a strong recovery from the 96.50 level following the Fed’s interest rate cut. However, the index is now approaching the key resistance zone around 100.50.

A sharp correction from the 100.50–101 region is likely, which may keep the U.S. Dollar Index trading within a broader range. Despite the recent rebound from key support, the overall trend for the index remains bearish.