Crude Oil Price Aims for $52 Despite Coronavirus Situation

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Written By: Eno Eteng (MSTA)

Dec 23, 2020, 13:18 GMT 13:18

WTI Crude Oil

Summary:

Crude oil price on the Brent benchmark is slightly higher this Wednesday, but finds the upside challenging as coronavirus worries weigh on price.

Ahead of the crude oil inventories report, crude oil price on the Brent crude variety is up by 0.72% today as a consequence of the passing of the stimulus vote in the US Congress. However, the threat by President Donald Trump not to sign the bill into law has put a lid on further intraday price advance.
Also weighing on crude oil price is the demand outlook, which may now be worsened by the emergence of the new coronavirus strain.

Focus remains on the coronavirus situation, updates from the US stimulus situation as well as the crude oil inventories data from the EIA later today. Data from the American Petroleum Institute (API) showed a build-up in crude inventories, but this has not reflected too much on the price action for the day.

Technical Outlook for Brent Crude

A new support has emerged at 49.22, made up of lows from Monday and Wednesday’s lows. Price bounced from this level and is now targeting 50.64 once more, but lacks momentum. A break of 50.64 is needed to re-establish the 52.38 resistance.

On the flip side, a breakdown of 49.22 brings 48.33 into the picture. Further downside targets 46.41 and possibly 44.16.

Brent Crude; Daily Chart

Written By: Eno Eteng (MSTA)

Eno is a certified financial technician and member of the UK Society of Technical Analysts. He loves to trade and write about stocks, Forex, and CFDs. Since 2009, he has consulted several financial companies as a trader and strategy developer. His work can be seen on several forex blogs and trading educational websites.