The oil prices have declined this week after the new Omicron strain was identified. What should we expect next from oil?
Trading plan for March 14
The most important event for today is the third round of parliamentary Brexit vote. It will take place around 21-22 MT time. Yesterday, the UK Parliament rejected the possibility of the “no-deal” Brexit. UK lawmakers decided they don’t want the nation to leave the EU without the divorce deal. As a result, the GBP appreciated. Today, the Parliament will vote on the extension of the Brexit process. If they agree to do it, we may see the further rise of the GBP.
Also today we anticipate the release of the OPEC’s monthly update on demand forecasts and production data. The news that Washington tries to pass legislation that would allow the US government to sue the organization was negatively met by the OPEC members. They noted that if the so-called NOPEC bill passes this week, the organization would stop working and every member would boost the production of oil to the maximum.
Now let’s consider the charts.
At first, let’s look at the daily chart of GBP/USD. There have been some intense trading during the last couple of days amid the Brexit votes at the Parliament. Yesterday’s rejection of a no-deal scenario pushed the pair towards the weekly pivot resistance at 1.3350. If today’s vote on the extension of the transition period is approved, the GBP will retest the resistance at 1.3350 and target the next resistance at the weekly pivot at 1.3445. In case of the defeat, the cable will fall to the weekly pivot level at 1.3180. The next support is placed at 1.3085.
Now let’s look at the H4. The pair has bounced from the 1.3240 level and started to move up on the news that the government is confident in today’s approval of the vote. If bulls continue to push the cable higher, it will retest the 1.3350 level and move higher. Negative news and fresh uncertainties will pull the pair below the 1.3240 level to the weekly pivot support at 1.3180. The next support is placed at 1.3126. If we look at the indicators, we can see that the ADX line shows that the market is overheated with the strong bullish pressure and Parabolic SAR demonstrates the upward movement for the pair. Also, we may notice that RSI is moving towards the overbought zone.
Now let’s look at the charts of Brent and WTI.
At first, let’s consider the daily chart of Brent. The news that US aims to cut Iranian oil exports under 1 million barrels per day pushed the price much higher since the beginning of the trading session. If bulls continue to push the price higher, they will manage to break the resistance at 68.55 and target the next one at the weekly pivot at 70.1. If OPEC shakes the market with the output boost, the price for Brent will fall to the first support at 67.12. The next support is placed at the weekly pivot at 65.57. ADX shows the strength of bulls.
Now let’s look at the chart of WTI. It has been rising after yesterday’s market report published by the Energy Information Administration and the news about Iranian oil. If more news on the output cut is released, bulls will manage to break the 58.56 level and move up to the resistance at 59.94. On the other hand, if bears take over the market, the price for WTI will fall to support at 57.28. The next support lies at 55.9. From the technical side, we can see that ADX shows bulls are gaining strength.
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