This article provides a detailed analysis of crude oil price movements, technical trends, and trading strategies amid recent market volatility.
Last week, the price of crude oil increased. Crude oil futures on the local market (₹10,408/barrel) and on the Intercontinental Exchange (ICE) ($109/barrel) increased by 10.8% and 3.5%, respectively. Here’s an analysis.
Crude Oil Price Surge and Market Overview
Following a gap-up beginning on Monday, Brent crude oil futures were unable to sustain the rise and fell. But it increased 7.8% on Thursday, suggesting that the overall bullish tilt is still present.
The 21-day moving average near $100 was the catalyst for the recovery. The latest weekly candles’ longer lower wicks, especially those between $96 and $104, indicate strong purchasing demand.
Technical Indicators and Bullish Momentum
Brent crude futures have a good likelihood of rising in the future, perhaps to $120. If this breaks out, the contract may reach $130. The prognosis will only become negative if the support level at $96 is decisively breached. $90 is the support level below $96.
📊 Crude Oil Key Levels
- Brent Price: $109/barrel
- Support: $96 and $90
- Resistance: $120 and $130
- Trend: Bullish momentum
- Indicator: Strong buying demand
MCX Crude Oil Performance and Outlook
With a larger rise of 10.8%, crude oil futures on the MCX outperformed Brent crude futures. On Thursday, it reached a fresh all-time high of ₹10,640 before declining to ₹10,408.
We may expect more upside in the upcoming days because the chart indicates a strong bullish momentum. If the contract can maintain its current velocity, it may shortly rise to ₹11,200.
Possible Correction and Price Range
However, there is a significant likelihood that the contract will moderate to the ₹9,800–10,000 price range. Before crude oil prices reach new highs, the corrective slide might reach ₹9,300.
📈 MCX Trading Strategy
- Buy Levels: ₹10,000 and ₹9,400
- Target: ₹11,200
- Stop Loss: ₹8,700
- Trend: Bullish with correction risk
- Advice: Manage volatility carefully
Go long at ₹10,000 and ₹9,400 as your trading plan. A stop-loss of ₹8,700 is possible. ₹11,200 in book profits. Risk-averse traders may choose to avoid the product due to its potential for significant volatility.
Frequently Asked Questions
1. What caused the price of crude oil to increase last week?
Strong purchasing activity, technical support levels, and optimistic market attitude that raised demand expectations all contributed to an increase in crude oil prices.
2. What is the crucial level of support for Brent crude?
$96 is the crucial support level. A decline below here might make the market attitude more pessimistic and undermine the upward trend.
3. What is the anticipated increase in Brent crude prices?
A breakout above $120 for Brent crude might drive prices closer to $130.
4. What made MCX crude perform better than Brent crude?
Due to reasons related to local demand, the influence of the currency, and increased trade activity in the Indian market, MCX crude experienced larger gains.
5. What is the suggested approach to trading?
With a stop-loss at ₹8,700 and a goal of ₹11,200, traders can go long at ₹10,000 and ₹9,400.
Conclusion
Although there is still turbulence, crude oil is still bullish and has significant momentum. Traders should carefully control risks, adhere to a disciplined plan, and keep an eye on support levels.
Disclaimer: This article is for informational purposes only and does not constitute trading or investment advice.
