Natural Gas and Oil Forecast: Oil Bounces Above $78.60; Time to Buy?

Market Overview

Oil prices rose in early trade on Monday as investors anticipate a possible rate-cut cycle beginning in September. ANZ Research noted that recent inflation and labor market data suggest conditions for the Federal Reserve to start cutting rates.

The Fed’s next Federal Open Market Committee (FOMC) meeting on July 30-31 is expected to maintain current rates, but investors will look for hints of future cuts.

Additionally, U.S. President Joe Biden’s withdrawal from the re-election race and endorsement of Vice President Kamala Harris has added political uncertainty. China’s slower economic growth of 4.7% continues to weigh on oil demand forecasts.

Natural Gas Price Forecast

Natural Gas (NG) is currently trading at $2.166, up 1.72%. The pivot point at $2.13 is critical for determining the market direction. Immediate resistance is at $2.21, with further resistance levels at $2.27 and $2.34.

On the downside, immediate support is at $2.02, followed by $1.97 and $1.92. The 50-day Exponential Moving Average (EMA) is at $2.14, while the 200-day EMA is at $2.32, suggesting a bullish trend if prices stay above the pivot point.

The overall outlook remains bullish above $2.13, but a break below this level could trigger a sharp selling trend.

WTI Oil Price Forecast

USOIL is currently trading at $78.99, reflecting a 0.61% increase. The pivot point, set at $78.60, serves as a crucial level for determining the next market move. Should the price break above the immediate resistance at $79.76, it could potentially reach higher resistance levels at $80.50 and $81.31, indicating a bullish trend.

Conversely, if the price dips below the pivot point, immediate support is at $77.88. Further support levels are positioned at $77.23 and $76.45, which could be tested if the market turns bearish.

The 50-day Exponential Moving Average (EMA) is currently at $80.74, while the 200-day EMA stands at $81.43, both suggesting a bullish trend as long as the price remains above the pivot point. Overall, USOIL’s technical outlook indicates a bullish stance, provided it stays above $78.60.

Brent Oil Price Forecast

Brent crude oil (UKOIL) is currently trading at $83.03, reflecting a 0.67% increase. The pivot point at $82.56 is crucial for determining market direction. Immediate resistance is found at $83.18, with further resistance levels at $83.99 and $84.79.

On the downside, immediate support is at $81.92, followed by $81.22 and $80.62. The 50-day Exponential Moving Average (EMA) is at $84.32, and the 200-day EMA is at $84.81, indicating a bullish trend if prices remain above the pivot point.

The overall outlook remains bullish above $82.56, but a break below this level could trigger a sharp selling trend.