Short-term prospects of growth for oil

28 March 2023 238
Short-term prospects of growth for oil

According to Russell energy experts, China could become an even bigger oil consumer soon as the country's crude oil shipments reach a new high of 10.8 million barrels per day in 2023. In addition, imports of black gold in the Celestial Empire will increase by 6.2%, while the processing of crude oil at refineries will increase by 7.8%, and this shows an increasing oil demand in the country.

The Bringing of the two new plants Guangdong and Jiangsu Shenghong into service will significantly increase this demand, as their total capacity will reach 520,000 barrels per day. In addition, Shandong Yulong may start importing crude oil this year. Beijing's decision to increase the country's oil reserves could also help stabilize black gold prices.

The news might influence Brent oil pricing as it could boost oil demand from China, the world's largest oil consumer.

On the other side of the planet, the large US hedge funds continue to sell oil contracts, the most significant sales have affected Brent and WTI crude oil. Investors prepare for the probable recession caused by tighter credit conditions in the US. There is a possibility that the fears of traders have already affected the quotes of Brent and WTI oil.

The price of Brent oil has gone beyond the downtrend of the H4 timeframe, which creates the possibility to form a new trend.

Short-term prospects of growth for oil - Photo 1

We look at the pricing on the hourly timeframe and see how the price forms an upward impulse of the third wave, breaking through the top of the first wave at the level of 77.10. Thus, oil quotes may grow towards the key resistance of 86.75 in the short term. We can place stop-loss outside the second wave around the level of 72.20.


Signal:

Brent’s long-term outlook is to buy one.

Target is at the level of 86.75.

Part of the profit should be fixed around 83.30.

Stop-loss is around the level of 72.20.

Bullish has short-term prospects, so choose a trading volume not higher than 2% of your balance.

This content is for informational purposes only and is not intended to be investing advice.

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