Natural Gas and Oil Analysis: A Market at the Cusp of Change

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Updated: Nov 29, 2023, 14:19 GMT+00:00

UK Oil’s steadfast performance above key pivot points reinforces a bullish market sentiment, with eyes on resistance challenges.

In this article:

Natural Gas

-3.91%

WTI Oil

-0.60%

Brent Oil

-0.89%

Key Insights

With OPEC+ poised to discuss supply curbs, oil markets are responding positively to the prospect of reduced output.
Natural gas prices show a slight decline, potentially setting the stage for a rebound as technical indicators suggest oversold conditions.
US and UK oil prices edge higher, driven by supply disruptions and expectations of further OPEC+ production cuts.

Quick Fundamental Outlook

Oil prices climbed in the latest Asian trading session, buoyed by expectations of extended OPEC+ production cuts. Contributing factors included a softer dollar in response to dovish Fed official remarks and significant supply interruptions.

Storms in the Black Sea have caused substantial export reductions, including a 56% cut in output from Kazakhstan’s primary oil fields, impacting up to 2 million barrels per day.

Ahead of the imminent OPEC+ meeting, the prospect of intensified supply curbs is poised to further constrict the oil market into 2024.

Natural Gas Price Forecast

Natural Gas (NG) Chart

In today’s commodities market, Natural Gas (NG) exhibits subtle fluctuations, edging down marginally by 0.11% to a price of $2.78. Positioned just below its pivot of $2.87, NG currently tests crucial support zones at $2.75, with further fallbacks anticipated at $2.62 and $2.52 should the downward trend persist.

Technical indicators paint a mixed sentiment; the RSI is at a tentative 31, flirting with the oversold boundary, which may signal a potential rebound. Meanwhile, NG trades below the 50-Day EMA of $2.99, hinting at a short-term bearish trend.
A prominent double top pattern presents resistance at $3.85, and its breach could indicate a bullish shift.

The overall trend is neutral, with bullish potential upon a decisive breakout of $3.80. In the short term, market participants are watching whether NG will challenge and possibly breach the resistance at $3.00 in the upcoming sessions.

WTI Oil Price Forecast

WTI Crude Oil (WTI) Chart

US Oil has experienced a modest uptick in its latest session, currently trading at $76.68, reflecting a 0.24% increase. Analysts are monitoring a crucial pivot point at $77.03, with a potential breakout indicating further bullish movement.

Immediate resistance levels are observed at $78.40 and $79.85, with a significant marker at $81.04. Conversely, support levels at $75.33 and $73.98 provide a buffer against any downward correction, with $72.15 acting as an additional cushion.

The Relative Strength Index (RSI) stands at 56, signaling a growing bullish sentiment without entering overbought conditions. This is echoed by the MACD, where a value of 0.2200 over its signal of 0.0900 suggests an upward momentum. The asset currently trades above the 50 EMA of $76.21, reinforcing the short-term uptrend.

Chart analysis shows a breakout from a downward channel at $76.20, with a firm hold above $77 potentially triggering a buying trend. In summary, the market sentiment for US Oil is bullish above the $77 mark, with expectations set for the asset to challenge imminent resistance levels in the upcoming trading days.

Brent Oil Price Forecast

Brent Oil Chart

UK Oil is charting a bullish course, trading up by 0.47% at $81.73, consolidating above its pivot point at $80.93. The commodity’s climb signals a potential test of resistance levels at $82.95 and $84.71, with the prospect of extending gains towards $87.34. Support is established at $78.56, with further cushions at $76.57 and $74.50 should a reversal occur.

The Relative Strength Index (RSI) reads at 57, suggesting bullish momentum is gathering without being overextended. This is complemented by a MACD value of 0.2000, slightly above its signal of 0.1500, hinting at sustained upward pressure. The price comfortably sits above the 50-Day EMA of $80.98, affirming the prevailing positive trend.

Notably, a bullish breakout from a symmetrical triangle pattern at $80.90 reinforces the potential for ongoing bullish momentum. In conclusion, the short-term outlook for UK Oil is bullish above the $80.90 threshold, with expectations for a move towards and possibly beyond immediate resistance levels in the near future.

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About the Author

Arslan Aliauthor

Arslan is a finance MBA and also holds an MPhil degree in behavioral finance. An expert in financial analysis and investor psychology, Arslan uses his academic background to bring valuable insights about market sentiment and whether instruments are likely to be overbought or oversold.

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