Buying Brent upon breaching $105 level

Brent crude has settled firmly above the psychologically important level of $100 per barrel. So far, political efforts to de-escalate tensions in the Middle East and push oil prices back below this threshold have proven fruitless.

To pursue these goals, members of the International Energy Agency (IEA) have recently decided to unleash 400 million barrels of fuel from their emergency reserves—the largest stock release in the organization’s history. The former record of 182.7 million barrels was set in 2022. However, experts believe that even if these volumes were injected into the market at maximum capacity, they would not be enough to cover just half of the daily deliveries (~20 million barrels) that passed through the Strait of Hormuz before the crisis.

From a technical standpoint, Brent prices appear poised for a successful break through the $105 level. The Relative Strength Index (RSI) climbed above the 50 threshold and settled comfortably in the positive zone, signaling that neutral territory is in the rearview mirror and an uptrend is gaining traction. The Moving Average Convergence/Divergence (MACD) turning green adds further confirmation of looming upside and rising bullish momentum.

The final recommendation:

— Sell Brent crude if the $105 threshold is breached, targeting $110 within the next one to two weeks;

— Place a Stop Loss order at $104.5, slightly below the support level, to manage risk if the market plays against us.