Yesterday, Brent crude prices moved sharply higher, with the XBR/USD chart showing breakouts above local resistance levels. Today, the price has climbed above the $110 mark, bringing it close to the multi-year high recorded on 9 March.
The bullish sentiment in the oil market is being driven by ongoing military tensions in the Middle East. According to recent media reports:
- → US President Donald Trump stated that Israel was responsible for the attack on Iran’s South Pars gas field;
- → Iranian missile strikes on Qatar’s key liquefied natural gas facilities caused significant damage.
Technical Analysis of XBR/USD
Recent price action allows for the construction of an ascending channel on the XBR/USD chart, reflecting heightened concerns over further escalation.
From a bullish perspective (as indicated by the arrows):
- → yesterday’s V-shaped rebound near the line dividing the lower half of the channel suggests strong buying pressure;
- → bulls showed confidence by breaking above the $106.40 level;
- → price remains in the upper half of the channel, with the median line potentially acting as support.
From a bearish perspective:
- → the RSI indicator is hovering near overbought territory;
- → long upper wicks around the $110 level point to selling pressure;
- → the upper boundary of the channel may act as resistance.
Taking the above into account, Brent prices remain under the control of buyers. As such, any pullbacks are likely to be limited in depth. A meaningful reversal would require significant changes in the geopolitical landscape.
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