The mid-month meeting between U.S. President Donald Trump and Russian President Vladimir Putin initially raised hopes among market participants for an end to hostilities and partial lifting of sanctions on Russian exports. This initially pressured oil prices, but the absence of concrete peace plans has cast doubt on the likelihood of increased hydrocarbon supply.
Another bullish factor has been the drawdown in U.S. crude inventories for the second week in a row: according to the American Petroleum Institute (API), stocks fell by 0.947 million barrels last week, while the U.S. Energy Information Administration (EIA) reported a decline of 2.392 million barrels. However, the current rebound does not yet look sustainable and could be followed by renewed downside pressure. Analysts believe demand for oil and gasoline may weaken sharply with the end of the summer driving season. At the same time, OPEC+ is set to reduce production in September by another 547,000 barrels, though it is possible that the cartel and its allies may not reach a new agreement on quotas next week. In the near term, supply growth may significantly outpace demand, putting pressure on energy prices.
Support and Resistance Levels
The instrument has consolidated above the middle line of the Bollinger Bands and is testing 64.06 (Murray level [1/8]). The key bullish level remains 65.62 (Murray level [2/8]), reinforced by the upper Bollinger Band: a breakout above this level would open the way toward 68.75 (Murray level [4/8]) and 71.88 (Murray level [6/8], upper boundary of the descending channel). On the downside, a move below 62.50 (Murray level [0/8]) would trigger renewed declines toward 59.38 (Murray level [–2/8]) and 55.50 (four-month lows).
Technical indicators remain mixed: Bollinger Bands are trending downward, MACD is stable in negative territory, while Stochastic is attempting to turn upward.
Resistance levels: 65.62, 68.75, 71.88.
Support levels: 62.50, 59.38, 55.50.
Trading Scenarios
Short positions can be opened below 62.50 with targets at 59.38 and 55.50 and a stop-loss at 64.80. Implementation period: 5–7 days.
Long positions can be opened above 65.62 with targets at 68.75 and 71.88 and a stop-loss at 63.50.
Scenario
- Timeframe: Weekly
- Recommendation: SELL STOP
- Entry point: 62.50
- Take Profit: 59.38, 55.50
- Stop Loss: 64.80
- Key Levels: 55.50, 59.38, 62.50, 65.62, 68.75, 71.88
Alternative Scenario
- Recommendation: BUY STOP
- Entry point: 65.65
- Take Profit: 68.75, 71.88
- Stop Loss: 63.50
- Key Levels: 55.50, 59.38, 62.50, 65.62, 68.75, 71.88