The oil market has witnessed a turbulent week, with prices recently declining by around 2%, following a prior-day rebound of a similar magnitude.
Economic uncertainties continue to weigh on oil prices, with traders expressing apprehension about growth prospects, particularly against the backdrop of elevated interest rates. Europe, already grappling with these pressures, received a stark reminder from the ECB today.
Earnings season has not been particularly favorable, further emphasizing the economic downside risks.
Additionally, the situation in Gaza and Israel, which previously prompted a surge in oil prices, is now being reversed as it is perceived that the likelihood of a broader conflict is diminishing.
Crude oil consolidation?
From a technical viewpoint, BCOUSD seems to be in a consolidation phase, characterized by choppy trading in recent days.
Clarity may emerge in the next few days if the price remains above the 55/89-day simple moving average band and the ascending trendline. The recent inability to reach new highs suggests this consolidation.
However, a move below this zone may indicate the start of a corrective phase. A definitive confirmation of this scenario may necessitate a drop below the October lows, situated slightly below $84.
