Following an extended bearish trend, Brent crude prices fell below the key support of $65.4 per barrel.
This sharp drop stems from the expectation that OPEC+ nations are poised to boost their total oil production by 500,000 barrels per day (bpd) in November—triple the amount they increased in October. On top of that, Saudi Arabia is actively seeking to recapture its market share by stepping up its output.
Over the coming months, fuel inventories in the US and worldwide are set to grow more rapidly, a trend driven by an anticipated surge in OPEC+ production, planned global refinery maintenance, and a seasonal decline in oil consumption. On Wednesday, the Energy Information Administration (EIA) reported that American crude, gasoline, and distillate stockpiles climbed up in the previous week due to slower processing activity and sluggish demand. A looming economic slump caused by the US government shutdown and the restart of Kurdish oil exports from Iraq are also putting significant pressure on prices.
Despite these negative factors, technical analysis suggests the most probable outcome for the aforementioned petroleum grade is to return to the breached support at $65.4 per barrel.
The overall recommendation is to buy Brent crude. Profits are taken at $65.4. Stop loss is set at $63.7.
Calculate your open position so that a potential loss (protected by a Stop Loss order) is limited to 1% of your deposit. If your account balance does not allow entering a position of this size, it is better to skip the trade and wait for other market signals that meet low-risk criteria.
This content is for informational purposes only and is not intended to be investing advice.
