Crude Prices Face Potential Barrier Ahead of Next Upward Move
Oil prices have risen significantly in recent times, with Brent crude oil futures on the Intercontinental Exchange (ICE) increasing by 9.3% to $96.30 per barrel, and domestic crude oil futures rising by 7.4% to ₹8,578 per barrel.
The Brent crude futures saw a price uptick in the first half of last week but remained flat in the latter half, retaining its gains. However, there is a potential barrier ahead at $98, where a rising trendline intersects with the current price, which could trigger a price correction to $90.50 or even lower to $88.75 if breached.
On the other hand, if Brent crude futures break out of $98, it can extend its rally to $101.50 and potentially reach $110. In the domestic market, crude oil futures (Sept) rallied last week, hitting a high of ₹8,791 on Thursday but ending the week lower at ₹8,578.
The price action suggests that there is buying interest between ₹8,400 and ₹8,600, indicating a likely further upside in prices. However, before the next upswing, the contract may moderate to ₹8,085, where the 21-day moving average lies.