OPEC+ will boost oil production by over 548,000 barrels per day in August. They will review this increase in their next meeting for September. This initial increase caused prices to drop, but later increases had less impact on the market. Global growth is still the main focus, aided by Federal Reserve interest rate cuts and reduced trade tensions.

Market Expectations

Market expectations are positive, and this could lead to higher demand. Prices may fluctuate between 60 and 90, but an upward trend is likely unless conditions change. On the 4-hour chart, prices are currently above the 64.00 support level. Buyers are expected to gather strength here, targeting 72.00 resistance. If the price breaks below, sellers could push it down to the 60.00 level. The earlier summary discussed key market dynamics, especially the oil alliance’s decision to increase output starting in August. They plan to add over half a million barrels daily, but future changes will depend on their next meeting, where they may alter September’s production based on market reactions. After this announcement, prices fell initially. However, this decline was short-lived, showing that the impact of ongoing production increases has lessened. The market may have already anticipated these moves or be focusing on other areas. Currently, there is significant attention on broader economic health indicators. Recent changes in central bank policies, particularly the move toward lower interest rates in the US, combined with easing trade tensions, have improved sentiment. There’s renewed interest in risk-taking, leading to slightly higher energy demand forecasts.

Technical Perspective

We can see a potential price range between 60 and 90. This range reflects both positive factors like economic recovery and negative risks like excess supply or policy mistakes. Right now, the trend appears to be upward, but any shift in these supportive factors would require quick reassessment. From a technical view, price activity shows strong support around the 64.00 level on the 4-hour chart. This area has held firm against downward pressure. If buyers continue to accumulate here—often involving larger players quietly adding long positions—a move toward 72.00 seems likely. Volumes and inventory data will be critical in confirming this direction. However, the 64.00 level is also a key pivot point. If prices break significantly below this level, it would indicate a loss of upward momentum, potentially leading to declines toward 60.00. This risk is important to consider, especially since volatility can rise during summer trading periods. In the coming sessions, attention should focus on momentum indicators, trading volumes around established support levels, and any insights from policymakers or major producers about potential changes in direction. It’s also wise to monitor short-term reversals near the 66 and 67 ranges, as these could signal broader shifts in sentiment. For those assessing their market exposure, responding swiftly to narrative changes will be more effective than waiting for confirmation after market movements occur. Create your live VT Markets account and start trading now.

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