Oil prices edged higher in Asian markets on Friday, with investors cautious ahead of critical U.S. employment data. Geopolitical tensions and OPEC+’s decision to delay production hikes added complexity to the market outlook.
Despite a significant U.S. crude inventory withdrawal of 6.9 million barrels, demand concerns, driven by mixed economic data and a weaker U.S. dollar, have kept oil sentiment bearish.
For the week, Brent crude was poised for an 8% drop, while WTI looked to decline nearly 6%. Natural gas prices are also sensitive to these developments, as broader energy demand may fluctuate accordingly.
Natural Gas (NG) chart shows a developing triple top pattern, presenting a significant resistance around the $2.277 level. Currently, both the 50-day and 200-day exponential moving averages (EMA) sit at $2.156 and $2.164, respectively, indicating underlying bullish momentum.
However, a decisive breakout above $2.277 is necessary to confirm further upward movement. Immediate resistance levels are $2.326, $2.371, and $2.407, while support stands at $2.217, with the next key levels at $2.165 and $2.110.
If the price fails to break through $2.277, we could see selling pressure intensify. In summary, bearish sentiment prevails below $2.277, but a break above could fuel a more pronounced bullish trend.
U.S. Oil (USOIL) is currently trading at $69.11, showing a slight decline of 0.22% in the 4-hour timeframe. The price is facing resistance at $70.47, which serves as today’s pivot point. The downward channel formation suggests that the bearish trend may continue unless a breakout above $70.47 occurs.
Immediate resistance levels are at $71.45, with higher targets at $72.99 and $74.36 if bullish momentum strengthens.
On the downside, immediate support is at $68.70, followed by $67.23 and $65.81. The 50-day EMA at $72.13 and 200-day EMA at $75.15 suggest that bullish momentum remains capped unless these levels are breached.
UKOIL is trading at $72.68, down 0.22% on the 4-hour chart. The price is hovering just above its pivot point at $72.30, which is a crucial level for today’s trading. If the price breaks above this level, it could encounter immediate resistance at $73.52, followed by higher targets at $74.27 and $75.49.
On the downside, immediate support is at $71.54, with lower levels of $70.81 and $70.12. The 50-day EMA at $75.64 and 200-day EMA at $78.68 show that any bullish momentum would face strong resistance unless these levels are breached.
For now, the bearish trend remains dominant below $72.30, with potential for a sell-off if the price breaks lower.
Arslan, a webinar speaker and derivatives analyst, has an MBA in Finance and MPhil in Behavioral Finance. He guides financial analysis, trading, and cryptocurrency forecasting. Expert in trading psychology and sentiment.