Crude Oil Continues Recovering
Dmitriy Gurkovskiy | Jun 21, 2021 10:55
The commodity market is starting another week of June with a recovery. Expectations of a relatively stable demand for energies continue pushing oil upwards. This first thing this optimism is based on is the speed of the anti-coronavirus vaccination campaign around the globe. Another factor is that many countries are slowly removing social restrictions imposed at the start of the pandemic. Taken together, these aspects have a positive influence on the demand for oil and crude products.
Another round, the sixth one, of US-Iranian negotiations on the nuclear deal was over last Sunday and it really does matter for the commodity market: if everyone is expecting a quick economic recovery, in the Northern hemisphere especially, then the oil supply has to be quite significant.
In this light, no one is scared of Iran’s potential return to the oil market and export anymore – it’s quite obvious that Iran may help to gradually expand the supply without any stress.
In the H4 chart, after rebounding from 70.00, Brent is still forming the ascending wave with the short-term target at 75.55; it has already reached 73.43. Possibly, the asset may consolidate around the latter level and then break the range to the upside to reach the above-mentioned target. Later, the market may start a new pullback to return to 70.00 and then resume trading within the uptrend towards 90.00. From the technical point of view, this scenario is confirmed by MACD Oscillator: its signal line is moving below 0 and may leave the histogram area, thus confirming a possible growth on the price chart.
As we can see in the H1 chart, after completing the ascending structure at 73.50, which may be considered half of another wave to the upside, Brent is expected to correct towards 72.32 and may later form one more ascending structure reach 74.74. After that, the instrument may fall to test 73.50 from above and then resume trading upwards with the target at 75.55. From the technical point of view, this idea is confirmed by the Stochastic Oscillator: its signal line moving above 50 and may soon start falling towards 20, which implies a slight decline and then another growth on the price chart.
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By Dmitriy Gurkovskiy, Chief Analyst at RoboForex
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