Natural Gas, WTI Oil, Brent Oil Forecasts – Oil Retreats Amid Profit-Taking

Natural Gas Attempts To Stabilize After Sell-Off

Natural gas is swinging between gains and losses as traders wait for additional catalysts.

The market is trying to stabilize after recent pullback, which was triggered by warm weather forecasts. Warm weather leads to low demand, which is bearish for natural gas markets.

From the technical point of view, natural gas failed to settle below the nearest support level, which is located in the $3.00 – $3.25 range. In case natural gas manages to settle below the $3.00 level, it will gain additional downside momentum and move towards the next support at $2.70 – $2.75. On the upside, a move above the $3.25 level will open the way to the test of the resistance at $3.50 – $3.55.

WTI Oil Pulled Back Towards $64.00

WTI oil is losing ground as traders react to the weak U.S. Retail Sales report and keep an eye on U.S. – Iran negotiations.

Traders stay focused on supply risks but are not ready to increase their long bets without additional confirmation.

Traders will also focus on tomorrow’s Non Farm Payrolls report, which will highlight the situation in the job market. This report may have a material impact on global markets due to the size of the U.S. economy.

WTI oil made an attempt to settle above the $64.50 level but lost momentum and pulled back towards the $64.00 level. In case WTI oil stays below $64.00, it will head towards the $62.50 level. A move below the $62.50 level will open the way to the test of the support at $60.00 – $60.50. RSI is in the moderate territory, so there is plenty of room to gain momentum in the near term.

Brent Oil Attempts To Settle Above $69.50

Brent oil is moving lower as traders take some profits off the table near weekly highs.

U.S. – Iran talks will remain the key catalyst for Brent oil in the near term. Iran wants to keep its nuclear and ballistic missiles programs, while the U.S. wants to get rid of them.

According to recent reports, Iran plans to focus the talks on its nuclear program and aims to avoid direct confict with the U.S. Meanwhile, the U.S. continues to boost its military assets in the region.

It remains to be seen whether bears will be ready to increase their short positions in this environment. The talks are extremely challenging, and both sides are far apart. In case the U.S. decides to use military force to deal a blow to Iran’s nuclear program, oil markets will rally, hurting short positions.

At the same time, the market lacks additional positive catalysts. Supply is stable despite geopolitical tensions. Recent reports indicate that the U.S. economy may be slowing down. China’s economy was hurt by trade wars.

Rising geopolitical premium provides support to oil prices, but growth is fragile. In case U.S. and Iran reach a deal, oil markets may suffer a strong sell-off.

The nearest resistance level for Brent oil is located in the $69.50 – $70.00 range. If Brent oil climbs above the psychologically important $70.00 level, it will move towards the next resistance at $73.50 – $74.00.

If you’d like to know more about how commodity markets work, please visit our educational area.