Piece written by Alexa Smith, Trive Financial Market Analyst 

On Tuesday, the Brent Crude Oil Futures (NYMEX: BB) increased for the third consecutive session, driven by signs of tighter supplies and China’s commitment to bolstering its economy. In response to the tumultuous post-COVID recovery, Chinese leaders pledged to provide support in the form of stimulus to boost domestic demand. 

Additionally, traders are growing optimistic about the possibility of global central banks approaching the end of their aggressive monetary policy tightening, further bolstering demand for the commodity. However, declining global PMIs are generating concern for the global economy, flattening the curve ahead of the interest rate decision from the Federal Reserve. Traders will keep a close eye on statements from Central Banks regarding the potential for future rate hikes.  

Technische Analyse 

The upward trend of the Brent Crude Oil Futures has flattened at the $83.12 per barrel (BLL) resistance, which could be a pivot point for downside momentum as demand outweighs supply. If the price action closes in the red, downside pressure may further boost prospects of a reversal where the 23.60% Fibonacci Retracement may pose a barrier towards the $78.85 BLL support. 

However, the price action could continue to consolidate amidst supply constraints which may encourage a break out past the $83.12 BLL resistance, where the $87.30 BLL major resistance may become a point of interest in furthering an upward trend. 

Zusammenfassung 

The Brent Crude Oil Futures have flattened ahead of the Federal Reserve’s interest rate decision which could encourage a pullback towards the $78.85 BLL support. However, the prospect of further supply cuts and stimulus from China could encourage a breakout towards the $87.30 BLL major resistance as Central Banks near the end of the monetary policy tightening. 

Sources: TradingView, Reuters, IBD, IEA