Brent crude still has upside potential after consolidation

Following a powerful rally on July 14, which pushed Brent prices to their highest levels since spring, the market has entered a consolidation phase on the daily chart, trading between $83 and $85 per barrel. Short-term technical indicators point to a temporary slowdown in bullish momentum—a pattern often seen ahead of the next decisive move.

Exponential moving averages also suggest a brewing shift in market dynamics. The EMA20 ($80.38) has just reversed upward, with prices holding above this level during the past trading sessions. Thus, the fast moving average appears to be the nearest support in case of a pullback. The EMA50 ($85.94) sits higher than current quotes, but its slope has begun to flatten noticeably after a prolonged decline. The narrowing gap between crude prices and the 50-day moving average signals that a reversal of the medium-term downtrend might happen soon.

The Relative Strength Index (RSI) has recently approached overbought territory. Its position near the upper boundary of the neutral zone reflects strong upward momentum but also serves as a caution that further accelerated gains—without at least a short‑term breather—could be limited. Volume analysis confirms this picture: the highest reading was recorded on the July 14 impulse candle, after which indicators steadily declined during the consolidation phase. For now, the market has paused.

The fundamental outlook remains bullish. The escalating conflict between the United States and Iran, the resumption of a naval blockade of Iranian ports, and threats to the Bab el-Mandeb Strait all pose persistent risks of supply disruptions in the region. Traffic through the Strait of Hormuz has recently fallen to record lows. China’s efforts to reduce imports and draw down strategic reserves partially mitigate the energy shock, but the overall shortage issue remains.

Pay attention to the following trading plan:

Buy Brent crude from current levels near $83.00. Place Take profit at $89.50 and Stop loss at $80.00.

This forecast remains relevant between July 17 and July 24, 2026.