Crude Oil Prices Slip as Demand Worries Weigh on Brent Futures

Crude oil prices remain under pressure as Brent futures edge lower, trading near the $73 mark. Despite recent attempts at recovery, demand concerns are capping gains as traders weigh mixed signals from the global economy and OPEC+ production strategies. The price action reflects ongoing indecision, with holiday trading adding to the muted momentum.

The technical landscape highlights Brent’s struggle to establish direction. The metal has failed to reclaim its 50-day EMA ($73.53), suggesting sellers are still active around higher levels.

Crude Oil Technical Analysis

• Resistance: Brent faces strong resistance at $75.98, a level that has repeatedly capped upside attempts. Beyond this, $81.17 represents the next major hurdle for bulls.
• Support: On the downside, immediate support lies at $72.94, where the 20-day EMA has provided a temporary floor. A decisive break below this could open the door to $69.69.
• Trend: Brent remains in a neutral-to-bearish zone, trading below the key moving averages. The inability to reclaim the 50-day EMA reflects hesitation among buyers.

Momentum indicators remain lackluster, with the RSI hovering near the neutral 50 level, while the MACD remains flat, signaling an absence of clear momentum in either direction.

Market Drivers

• Demand Concerns: Sluggish economic growth in China and Europe continues to weigh on demand forecasts. Recent data showing slower industrial output has only exacerbated these fears.
• OPEC+ Policies: While production cuts by OPEC+ have supported prices in recent months, the absence of fresh announcements has left the market looking for direction.
• Macro Outlook: With rising interest rates and inflation pressures, the outlook for oil consumption remains clouded. Traders are likely waiting for January to reassess broader macro trends.

Outlook

Brent’s inability to break above its 50-day EMA highlights the current lack of bullish momentum. A move above $75.98 could shift the tone, opening the way toward $81.17. Conversely, a dip below $72.94 may fuel further declines, with $69.69 becoming the next key target.

For now, the market remains in a wait-and-see mode, with traders likely focusing on developments in early 2025 to determine the next big move.

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