Oil Traders Pull Back amid Profit-TakingOil bulls are presently facing difficulty moving up at the fourth trading session of the week.
Recent price action suggests the bullish trend is suffering from exhaustion, as signs of bearish trades confide oil prices in forming a negative pattern that energy experts anticipate could push oil prices to start a short term correctional wave that targets testing around the $60 a barrel price level in the case of Brent Crude.
The British based oil contract, Brent crude at previously recorded gains in nine straight trading sessions, its longest sustained period of gains since two years ago.
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This has presently made oil traders thread cautiously as such rally prevailing in the energy derivatives markets, could tempt leading oil producers in pumping more crude to the oil market that is steadily showing signs of demand recovery to levels seen before the worst pandemic struck.
In addition, oil bears seem to be raising their heads up, at least for now on the bias that the Saudi’s could roll back their unilateral February/March production curbs and other leading oil players could signal more crude oil outputs coming back online at the next month meeting given the sizzling recovery in the energy derivative.
But taking the current bullish pause in the oil market too seriously could be at the traders’ peril, taking on the bias that oil bulls are taking a breather after printing a recent 12-month high, with Brent crude trading over $61 a barrel thereby suggest profit-taking is perfectly normal at such situation.
That being said, oil traders are significantly optimistic on prevailing fundamentals justifying further recovery of the price of the black liquid hydrocarbon in breaching the mid-term price level of $65/barrel and likely beyond by the end of 2021.