Brent Crude Oil is down 2.54% today, bringing bearish scenarios. UKOIL hit a record $135 in early March as the world was shocked by Russia’s invasion of Ukraine. Since then, the worries of the global recession have taken over the concerns of limited oil supply.
As you can see, there are two alternative bearish parallel channels for UKOIL. The green one is more optimistic. However, the red one is based on more recent price action. The chart had broken up from the pattern on August 30, when the prices exceeded $105. The candles soon returned to the red channel. However, the retracement happened at $88 instead of the expected $82.
The local bottom in September suggests we may enter the more benign green channel. October 9 (or around this date) should be critical for UKOIL and the price of $86 per barrel.
Traders should watch out for the blue vertical line, which marks September 21, the day of the Federal Reserve meeting on the interest rate. A record spike of one percentage point is possible, and if it happens, markets may panic, pulling oil prices even lower.
We’ve seen oil futures going negative in 2020, so there’s no hard support for the commodity. Fears of high-interest rates, global recession, and the already slower demand growth in China caused COVID lockdowns – these factors may push the prices into the red channel.
Trade accordingly with SimpleFX; oil prices will go up and down. That’s why every day brings a unique opportunity to profit.