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Natural Gas and Oil Forecast: Oil Below 200 EMA, More Selling Ahead?

By:
Arslan Ali
Updated: Jul 10, 2024, 10:50 GMT+00:00

Key Points:

  • Oil prices rebounded due to a drop in U.S. crude and fuel stockpiles.
  • Fed Chair Powell's comments increased the likelihood of interest rate cuts, boosting oil consumption.
  • Hurricane Beryl had minimal impact on Texas energy production, supporting a stable market outlook.
Natural Gas and Oil Forecast: Oil Below 200 EMA, More Selling Ahead?

In this article:

Market Overview

Oil prices rebounded on Wednesday after three days of declines, driven by reports of a drop in U.S. crude and fuel stockpiles. The American Petroleum Institute indicated a fall of 1.923 million barrels in crude stocks and a 2.954 million barrel drop in gasoline inventories, suggesting steady demand.

Comments from U.S. Federal Reserve Chair Jerome Powell bolstered the likelihood of interest rate cuts, which could stimulate economic growth and increase oil consumption.

Meanwhile, Hurricane Beryl’s impact on Texas energy production was minimal. This data and sentiment have supported a positive outlook for both oil and natural gas prices.

Natural Gas Price Forecast

Natural Gas (NG) Price Chart
Natural Gas (NG) Price Chart

WTI Crude Oil (USOIL) is currently trading at $81.33, reflecting a slight decline. The market is closely observing the pivot point at $81.76, which will be pivotal in determining the next directional move. Immediate resistance is identified at $82.46, followed by $82.98 and $84.03.

On the downside, immediate support is found at $81.00, with additional support levels at $80.15 and $79.47. The 200-day Exponential Moving Average (EMA) at $81.57 is the first major resistance level, and the 50-day EMA at $82.43 is the next major resistance.

Given the current technical setup, traders should consider selling positions below $81.76 to take advantage of potential bearish movements.

Brent Oil Price Forecast

Brent Price Chart
Brent Price Chart

Brent Oil (UKOIL) is currently trading at $84.52, reflecting a slight decline. The pivot point at $85.05 is crucial for determining the next directional move. Immediate resistance levels are identified at $85.79, $86.77, and $87.64. These levels are key barriers that could impede upward momentum.

On the downside, immediate support is found at $84.05, with additional support levels at $83.50 and $82.54. The 50-day Exponential Moving Average (EMA) at $85.86 acts as a resistance level, while the 200-day EMA at $85.11 serves as support.

Given the current setup, traders should consider selling positions below $85.05 to capitalize on potential bearish movements.

About the Author

Arslan, a webinar speaker and derivatives analyst, has an MBA in Finance and MPhil in Behavioral Finance. He guides financial analysis, trading, and cryptocurrency forecasting. Expert in trading psychology and sentiment.

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