Oil Market Insights: Examining WTI's Crucial $75.40 Threshold

Market Overview

Oil prices surged on Monday amid escalating fears of a broader Middle East conflict. The potential for supply disruptions in the region, coupled with U.S. interest rate cuts signaled by Federal Reserve Chair Jerome Powell, boosted global economic sentiment and fuel demand outlook.

Analysts expect crude prices to continue their upward momentum, with WTI possibly reaching $80. However, despite these gains, last week’s oil prices declined due to weak economic outlooks. The U.S. Energy Department’s recent purchase of 2.5 million barrels for the Strategic Petroleum Reserve further underscores supply concerns. This geopolitical tension and economic outlook also suggest potential volatility in natural gas prices.

Natural Gas Price Forecast

Natural Gas (NG) recently broke below an upward trendline near the $2.03 level, signaling a potential shift toward a bearish trend. This breakout suggests that NG could continue to decline, with immediate support at $1.98 and further downside targets at $1.94 and $1.90.

The 50 EMA at $2.10 and the 200 EMA at $2.14 are both in the selling zone, indicating that bearish sentiment remains strong. A retest of the $2.03 level, now acting as resistance, could further confirm the downward bias.

WTI Oil Price Forecast

WTI crude oil is trading close to the pivotal $75.40 mark, where the 200 EMA is capping further upside. This level is crucial, as it could dictate the next move for crude oil prices. A bearish engulfing candle has formed on the 4-hour chart, signaling potential downside pressure.

• Immediate support at $73.94
• Further support at $72.75 and $71.51
• On breaking above $75.40, prices could challenge resistance at $76.47, $77.38, and possibly $78.30

Brent Oil Price Forecast

Brent oil is currently trading just below its pivot point at $79.64, with the 200 EMA acting as a significant resistance at $79.13. A bearish engulfing candle on the 4-hour chart suggests that selling pressure may increase, potentially pushing prices lower.

• Immediate support at $78.72
• Further downside targets at $77.67 and $76.86

However, if prices manage to break above the $79.64 level, the bullish momentum could drive prices toward resistance levels at $80.37, $81.34, and $82.33.