Current trend

The price of WTI Crude Oil is correcting downwards after strong growth from July to September and is testing 89.00 during the morning session, preparing to continue its decline ahead of the meeting of the OPEC Joint Ministerial Monitoring Committee today at 11:00 (GMT 2).

According to analysts’ forecasts, no change of current oil production plansare is expected. At the June meeting of energy ministers of exporting countries in Vienna, an agreement was recorded on production parameters until the end of 2024, and the reduction in oil production from next year from quotas agreed in October 2022, according to expert estimates, will amount to 1.272M barrels per day. In addition, some OPEC countries, including Russia and Saudi Arabia, will voluntarily reduce volumes by 1.66M barrels per day by the end of next year. The cartel monitoring confirmed these same decisions at an online meeting on August 4. In conditions of supply shortage, oil prices retain a high potential for continued upward movement.

The current correction, which can be observed on the WTI Crude Oil and Brent Crude Oil charts, is rather technical and is caused by an increase in exports by Saudi Arabia and Russia in September by approximately 1.0M barrels per day, which became a catalyst for the “cooling” of the overheated “bullish” market.

Support and resistance

The long-term trend is upward: as part of the growth in September, the quotes reached a strong resistance level of 93.50, from which the correction began. After testing the support level 84.50, it is worth considering purchases with the target at the September high of 95.20.

The medium-term trend is upward but a correction is developing, within which the price has reached the key trend support of 88.78–88.12. The zone is still holding, so long positions can be considered from it with the target at last week’s high of 95.20. If the support area is broken, the trend will reverse downwards, and short positions with the target in zone 2 (82.18–81.52) are relevant.

Resistance levels: 93.50, 97.30.

Support levels: 84.50, 78.44.

Trading tips

Short positions may be opened below 87.70 with the target at 84.50 and stop loss around 89.20. Implementation time: 9–12 days.

Long positions may be opened from 84.50 with the target at 93.50 and stop loss 81.40.