Crude Oil Forecast: Key Levels for the Week Ahead
Crude Oil Forecast: Oil is dropping further into its consolidation, following the steep drops of the commodities market
Share this:
Key Events for the Week Ahead:
- US Advance GDP (Thursday)
- US Core PCE (Fed’s Favored Inflation Gauge) (Friday)
- Crude Oil Inventories (Wednesday)
Following bearish pressures from declining Chinese GDP, the spotlight now shifts to US GDP. In the first quarter of 2024, the US GDP recorded a significant decline, falling from 3.4% in the final quarter of 2023 to 1.4%.
This contraction, driven by elevated interest rates, has been reflected in leading economic indicators over the past two months. The risk of delaying rate cuts is tied to a contracting economy, which could potentially lead to a recession. This scenario signals bearish implications for oil demand and prices.
Crude Oil Inventories
Crude oil inventories have shown three consecutive and significant drops, reflecting elevated demand during the summer season, and maintaining positive effects on the chart. However, the overall technical outlook for oil remains bearish below the $85 mark.
Fed's Favored Inflation Gauge
The Core PCE reading, set for release on Friday, will be crucial for market volatility this week. A 0.1% drop from the previous reading could signal a retest of 2020 levels, confirming the disinflation trend and supporting a potential rate cut. Conversely, an increase could provide the Fed with justification to keep rates unchanged for the short-term horizon.
Key Levels for the Week Ahead
Crude Oil Forecast: USOIL – Daily Time Frame – Logarithmic Scale
Source: Tradingview
Following the respected triangle pattern, oil is delving deeper into its consolidation after retesting the 0.618 Fibonacci retracement of the drop between the high of July 5th and the low of July 16th. Bullish factors, such as inventory reports and geopolitical events, have triggered this retest.
This week's key levels are as follows:
Downside Support Levels:
- Short-term: 77 and 74
- Long-term: 72 and 68
Upside Resistance Levels:
- Short-term: 80 and 82
- Long-term: 84.30-85, 87.30, 92
--- Written by Razan Hilal, CMT
Related tags:
Latest market news
Open an account in minutes
Experience award-winning platforms with fast and secure execution, and enjoy tight spreads from 0.5 pts on FX and 0.3 pts on indices.
Economic calendar
Web Trader platform
Our sophisticated web-based platform is packed with features.
Related articles
Silver's bullish breakout case builds as bond yields retreat
The Democratic blue wave has sent crude and Treasury yields sharply lower, improving the outlook for precious metals. With gold already breaking higher, could silver be next?
Swiss Franc Short-term Outlook: USD/CHF Selloff Nears Critical Support Ahead of NFP 11 4 2026
USD/CHF bears are closing in on critical trend support, with the next reaction likely to determine whether the October decline has further to run.
US Midterm Fallout: What Does the “Blue Tsunami” Mean for the S&P 500?
Democrats made sweeping gains in the US midterm elections, winning control of both the House and Senate - what does it mean for the S&P 500 and the AI trade?
This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.
StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.
In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.
StoneX Financial Pte. Ltd. is not under any obligation to update this report.
Trading CFDs carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit www.forex.com/en-sg/terms-and-policies for the complete Risk Disclosure Statement.