As predicted yesterday here on Investingcube, crude oil price appears to be on course to hit $64, as it continues to slide this Friday on the back of the spreading COVID-19 delta variant, which has thrown up serious demand concerns. Furthermore, additional US Dollar strength from the FOMC minutes and safe-haven demand continue to weigh on commodity prices.
Surging cases of the delta variant of the coronavirus are forcing countries to implement partial or complete lockdowns. For instance, New Zealand has extended its three-day snap lockdown until next week, saying it will only provide updates on how long this will last by Monday.
According to analysts from ANZ, the spread of the delta variant has combined with the prospects of countries raising rates soon to squeeze the commodity markets. New restrictions on travel and movement could cut demand for crude oil significantly in the coming weeks if the situation continues.
Brent crude is down 1.88% now, as it hits a 7th straight day of losses.
The breakdown of 65.95 is now complete, with crude oil price heading for the next support at 64.64. Continuing pressure by the bears could force prices below 64.64, which brings 62.33 into the picture as the next target.
On the flip side, bulls would be hoping for a bounce at some point, which ultimately targets a break of the redrawn dotted trendline to provide a realistic chance of an attempted recovery towards 73.44 initially. 75.52 and 77.93 are additional targets to the north if this outlook materializes. Otherwise, any rallies to points below this trendline could bring in new offers into the market.