Crude Oil Forecast: Looks To The Upside

Date

9/18/2023 4:17:03 AM

(MENAFN- Daily Forex)

crude oil markets took a slight step back during the early hours of Friday, signaling a potential need for a breather.
The West Texas Intermediate Crude Oil market seemed to initiate a rally but encountered some profit-taking as we headed into the weekend.
This adjustment appears logical given the multitude of variables in play, capable of impacting global markets.

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In the event of a pullback, the $87.50 level appears to be a region where buyers may re-enter the scene. This level holds significance as the body of the most recent consolidation. The prevailing situation suggests a strategy of buying on the dips, largely driven by OPEC's ongoing efforts to reduce production. It's a classic case of supply and demand dynamics at play, and with OPEC effectively removing 1 million barrels from daily production, higher pricing remains a logical outcome. Despite the occasional market noise, the overall trajectory seems upward.

Turning our attention to Brent markets, they too show signs of exhaustion, stepping back from an initial upward push during the early hours. In this scenario, market participants are on the lookout for value opportunities. The $90 level stands out as a logical choice, having served as a previous consolidation point and being a psychologically significant round figure.The Markets are Navigating a Complex Landscape

Further up the ladder, the $95 level presents itself as another noteworthy milestone. This level has proven to be a formidable barrier, as expected from a large, round, and psychologically significant figure. While it may cause some trouble, it also stands as a potential target in the coming trading sessions. It's important to note that shorting crude oil at the present juncture holds little appeal, given the ongoing challenges related to supply constraints.

In essence, crude oil markets are navigating a complex landscape. The delicate balance between supply and demand, coupled with various global factors, is contributing to the market's nuanced behavior. As we move forward, the trajectory seems inclined toward higher prices, with occasional volatility and hurdles along the way. Caution and strategic thinking are key when engaging with this market, and for now, shorting crude oil appears to be an unwise move given the ongoing supply struggles. If the Saudis and the Russians are willing to keep the supply tight, upward pressure will continue to be a factor in this market.

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