After a short correction, oil is restoring, returning to full-scale growth. On Monday, February 22nd, a barrel of Brent costs 63.85 USD.
On H4, BRENT is trading in another structure of growth from 60.10, aiming this wave of growth at 65.30. The goal is local. At the moment, the market is forming a consolidation range of around 62.62. Today, we expect it to extend to 63.00. With a breakaway of this level upwards, the growth should continue to 65.00 and perhaps over 65.30.
Technically, the scenario is confirmed by the MACD oscillator. Its signal line rests near zero. We expect the histograms to grow and the signal line – to enter the histogram area. As soon as this happens, the growth of the price will speed up.
On H1, BRENT is growing, aiming at 63.37. Then a consolidation range might form around this level. With an escape upwards, the trend might continue to 64.94. The goal is local.
Technically, this scenario is supported by the Stochastic oscillator. Its signal line is currently trading under 80. This means the market is overbought, and a correctional decline might develop to 50, followed by growth to 80.
According to Baker Hughs, during the week before February 19th, the number of drilling rigs remained unchanged at 397 units. Meanwhile, the number of oil derricks has dropped for the first time in 13 weeks (-1 unit), while the number of gas towers has grown (+1 unit).
Last week, the US Department of Energy reported a decrease in the number of crude oil reserves by 7.3 million barrels after falling previously by 6.6 million barrels. This quite supported buyers: cold weather in the USA increases the demand for energy carriers.
The same factor – freezing weather – influenced oil production in the USA as well, mostly due to Texas and surrounding territories. All in all, fundamental news turned out on the bulls’ side.
Written by Admin
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