Photo - Andreas Zanin
Andreas Zanin
Analysis | May 4, 2021

KTM Commodity Weekly: The year after

The oil market was higher than 5.60% in April and loved to continue its movement in the 1st trading session in May. Last month’s performance was the best since 2018.

One-year birthday:

  • April closing was the first anniversary of the Oil market’s lowest point.
  • Fast-forwarding to the current date, we are at new heights, trading at $67 pre-pandemic levels. It was a very challenging year, but vaccine rollover and reopening of the economies supported the sentiment, so do the price action.
  • OPEC+ output cut and vaccine rollover are the key two drivers behind the massive surge in oil prices.
  • From the lowest point, Brent was up over 345% as of 03 May 2021. The biggest rally in three decades, as per available historical data.
  • The current bulls market produced a 5-month winnings streak. The last time the run lasted for 7-months between July 2017-Jan 2018.

Looking ahead, Brent crude oil is trading above 100MA (Monthly) for the third month in a row, but a monthly close is required to stretch its arm at $74 and $80 levels. Easing restrictions in Europe and the US supports the sentiment, so it makes the oil demand.

Technically, higher lows and higher highs are clearly evident on the weekly chart, along with a double bottom pattern at $63.90. Against this backdrop, the Brent is unlikely to lose its height unless a double bottom pattern is taken out.

It is important to always keep in mind the risks involved in trading with leveraged instruments.

What is your Technical View?

Do you have a different idea? Please leave us a comment and get an answer from our professional analysts

Latest Article
Improve your trading with a True ECN Broker
Trading account overview