Oil prices saw a slight recovery after hitting multi-month lows, driven by expectations that OPEC+ may delay its planned output increase and falling U.S. crude inventories.
The Organization of the Petroleum Exporting Countries (OPEC+) is reconsidering its scheduled October production hike due to weak Chinese demand and an easing of Libya’s export disruptions.
Data from the American Petroleum Institute (API) showed a significant 7.4 million-barrel drop in U.S. crude stocks, offering further support.
However, ongoing concerns about sluggish global demand, particularly from China, continue to limit price gains.
Natural Gas (NG) is trading at $2.25, down by 0.49%, indicating a bearish trend on the 4-hour chart. The price action shows a clear resistance at $2.147, with NG forming a bearish engulfing pattern. A string of doji candles that reflect market uncertainty but emphasize the possibility of further downside follow this pattern.
The $2.147 level is a critical pivot point, and as long as prices remain below this mark, natural gas is likely to face downward pressure. If the price breaks below immediate support at $2.10, which aligns with an upward trendline, it could trigger further declines toward $2.08.
In the event that this support is breached, the next downside target would be $2.02. However, should natural gas break above the $2.147 resistance, we could see a shift in momentum, with prices heading toward the next resistance level of $2.20 and beyond. The market remains bearish at this stage unless NG can push above $2.147.
USOIL is trading at $69.40, up 0.34%, but facing key resistance at $70.48, which is a critical pivot point. Crude oil is in a consolidation phase, fluctuating between $71 on the upside and $68.85 on the lower side.
While oil hovers near oversold territory, the chances of a bullish reversal are strong. However, with the 50-day EMA at $72.89 and the 200-day EMA at $75.51 acting as higher resistance levels, the bearish sentiment remains dominant unless oil can decisively break above $71.
Immediate support lies at $68.19, and if breached, further downside could target $66.51 and $64.76. USOIL remains bearish, below $70.50 for now, but a breakout above this level could signal a shift toward bullish momentum.
UKOIL is trading at $72.91, up 0.25%, but the key pivot point at $72.30 remains crucial for its short-term outlook. The immediate resistance sits at $73.52, followed by stronger barriers at $74.27 and $75.49. On the downside, immediate support is found at $71.54, with further support levels at $70.81 and $70.12.
UKOIL’s 50-day EMA is positioned at $76.39, and the 200-day EMA stands at $79.04, indicating that the bearish trend remains dominant unless prices can break higher.
If the price closes below $72.30, a bearish continuation could follow, but a more bullish scenario could unfold if it breaks above this level. As of now, the bearish bias persists.
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.