By RoboForex Analytical Department
Oil continues to fall at the start of another May week. A barrel of Brent crude fell to 73.70 USD.
The sell-off in the commodities market has been ongoing for several weeks. Investors tried to get a foothold above 78.00 USD, but their attempts failed. The OPEC report, which normally looks optimistic, did not give investors any reason to buy this time. The main trigger for selling remains fears that the high interest rates around the world will put pressure on global economic activity. This, in turn, will reduce the demand for energy commodities.
Data from Baker Hughes showed that US drilling activity declined. Gas rigs were primarily affected (-16) but oil rigs also declined (-2).
On H4, Brent has worked its way up to the 77.44 level. The market continues to develop a correction today. A decline to 72.33 is expected, followed by a new wave of growth to 80.07. After its breakdown, a new growth potential could open to the level of 87.77. The target is local. Technically, this scenario is confirmed by the MACD indicator: its signal line is below zero, with growth to new highs expected.
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On H1, a consolidation range has formed around the 74.87 level. The market has escaped it downwards today. A decline to 72.56 is expected, followed by a rise to 74.87 and a decline to 72.33. After the price reaches this level, a wave of growth to 80.00 could begin. Technically, this scenario is confirmed by the Stochastic oscillator: Its signal line is breaking through the level of 20 upwards, aiming at 50. A rebound from this level is expected, followed by a new decline to 20. Next, growth to 80 could follow.
Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.
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