Analysis: oil price gets interesting
With few significant moves on oil markets for a while, independent analyst Alistair Strang believes something might be brewing.
1st August 2024 07:44
by Alistair Strang from Trends and Targets
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The end of July brought some really strange movements to the markets, forcing us to emblazon “nothing makes sense” against an astounding five different types of futures prices. As usual, it’s probably the UK’s fault, with the Bank of England speculated to lower interest rates.
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We’re not entirely convinced the markets have fully factored in the potentials, given the FTSE 100 (for instance) could easily accelerate faster than everyone else, given our potential target level at 8,482 points. It’d only be fair, given the FTSE's ability to languish behind every other market. If only the stock markets actually “did” fair.
Source: Trends and Targets. Past performance is not a guide to future performance.
In a few hours we should know what’s ahead for UK interest rates but, meanwhile, we’re once again slightly interested in Brent crude, the product almost at the point where it must start dripping lower.
Usually, this is the time when we cynically expect OPEC to announce something drastic or an event to cause the price of oil to spike. This being the case, we shall not be aghast if movement next above $82.00 provokes a surge in the direction of an initial $84.90 with our secondary, if beaten, at $87.85.
If the price of Brent crude intends to play fair, below $78.00 currently looks capable of generating reversal to an initial $68.59 with our secondary, if broken, at $60.87 and the potential for a bounce. As a caution, we’ve painted a third level target on the bounce, should such a secondary break, and it works out as a bottom of $50.
Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.
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