Natural Gas and Oil Forecast: WTI at Key Support as Stocks Jump 11.4M; WTI USOIL Hold $65.50 or Break Higher?

Oil and Natural Gas Rally as Geopolitical Tensions Lift Risk Premium

Oil prices have been stuck near seven-month highs because the increasingly tense geopolitics are adding to the risk that energy prices will continue to creep upwards. Brent crude went up by 0.6% to $71.20 a barrel, while WTI followed suit by also rising 0.6% to $66.01 per barrel, and both those gains were very close to the peaks reached earlier this week.

Markets remain super sensitive to any potential disruptions in supply, mainly from any of the key OPEC producing countries, but also the rest of the Middle East.

At the same time, the U.S. is storing a whole lot more crude – 11.43 million barrels as of last week – thanks to industry data, which is a pretty clear sign of supply & demand getting way out of balance.

Now, while the rest of the oil stockpiles (including for gasoline and distillates) are actually going down, everyone’s still waiting for the official numbers from the EIA to confirm what’s really going on. All the while, things have still got a lot of people pretty uncertain, which has oil and natural gas markets feeling pretty volatile indeed.

Natural Gas Price Prediction: Will $2.85 Breakdown Trigger Drop Toward $2.70?

Natural gas is trading near $2.827 on the 2-hour NYMEX, after slipping below the $2.854 support zone which is now acting as resistance. Price has been capped under a descending trendline from the $3.50 area and we’ve got new lows forming, confirming a downtrend.

The 50-period moving average at $2.95 is trending downwards while the 200 MA around $2.85 has actually been broken, which is weakening our structure here a bit.

Recent candlesticks are showing small bodies and upper wicks near the $2.90 area which suggests selling pressure is picking up a bit. Horizontal support comes in at $2.749 followed by $2.657. RSI is sitting below 45 which to us reflects a bit of fading momentum without any extreme oversold conditions.

Trade idea: look to sell below $2.80 and aim for $2.70, stop above $2.92.

WTI Crude Oil Price Prediction: Can $65.50 Support Drive Push Toward $67.30?

WTI crude is right now sitting at $65.89 on the 2-hour chart – just barely holding on above the $65.50 support zone. We saw the price bounce back a little from the $66.54-$67.29 resistance area but its clear the ascending trendline from $61.50 low is keeping price in check. Candlesticks are looking a bit smaller near support, which suggests to us a bit of consolidation rather than super strong selling pressure.

The 50-period moving average at about $65.20 is acting like a sort of dynamic support line, meanwhile the 200 MA at $64.15 is reinforcing the whole upward trend for us. RSI sits at about 50-55, which to us suggests a pretty normal and balanced state of affair with no extreme conditions to speak of.

If price does manage to hold above $65.50, then it’s a pretty safe bet the resistance at $66.54 & $67.29 is next on the agenda. A break below $65.20 could put $64.77 into play.

Trade Idea: Look to buy above $66.60 and aim for $67.30, stop below $65.20.

Brent Crude Oil Price Prediction: Can $70.22 Support Hold Above Key Fibo Levels?

Brent crude is right now trading near $70.81 on the 2 hour chart after bouncing back towards the $70.22 support zone which also happens to be at the 0.382 Fibonacci level. Price recently rallied upwards from $66.84 and had a look at $72.31, forming new highs before consolidating a bit.

The rising trendline from $66.80 remains intact, while we have the 50-period moving average at $70.30, keeping the dynamic support nice and tight. Meanwhile, the 200 MA at $68.92 is still supporting the broader trend for us.

Candlesticks are looking a bit smaller near the $71.00 mark which is reflecting a bit of hesitation below the 0.236 Fibo at $71.02. RSI is hovering right around 55-60 which to us suggests steady momentum.

Trade Idea: Look to buy above $71.10 and aim for $72.30, stop below $69.50.