Brent rose further on Wednesday, following quick recovery after spike to $97.07 on Tuesday, reflecting fresh uncertainty in energy market after short-lived relief.
New clashes in Yemen, Ukraine’s attack on Russian oil refineries and Iran threatening of closing all ‘illegal routes’ in Hormuz strait boosted volatility ahead of decisions of the EU and IAE to release strategic reserves of diesel, in attempts ease pressure, as diesel prices skyrocketed to record highs in the US and Eurozone.
Brent contract holds steadily above $100 for the fifth consecutive day (Tuesday’s dip failed to register close below this level), pointing to bullish sentiment.
As a result, daily studies improved further, with 14-d momentum heading north and flirting with the centreline, RSI rising above 50 and MA’s predominantly in bullish configuration.
Technical signals are mainly positive, though with sustained break above 20DMA ($102.43) required to maintain positive bias and lift above $103.95 (Oct 1 top) needed to bring bulls fully in play.
Also, near-term action is expected to remain biased higher while the price holds above $100.50 (10DMA), guarding lower breakpoint at $100.
However, fundamentals (as key driver) will be closely watched for fresh direction signals.
Res: 103.37; 103.95; 104.17; 105.00
Sup: 101.89; 100.50; 100.00; 98.40
