Analysis

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USOIL
Mar 22, 2021, 9:48 AM GMT
#Commodities

Bearish Reversal in the Making on the Price of Crude Oil

The underlying supply and demand equilibrium in the energy market is currently changing. Demand is falling as the global economic recovery is presently undergoing through a soft patch owing to a number of contributing factors. This is prompting the beginning of a new bearish correction on the price of crude oil.

The most significant factors currently weighing down on the commodity include the tumultuous vaccination efforts in Europe; the uneven pace of global recovery (here and here); the expectations for continued troubles for the key industrial sectors in Europe; and the momentarily subdued consumption in the U.S. All of these factors, in conjunction with the relatively uneventful week ahead, are likely to support such a bearish reversal on the price of crude oil.

Trading on such expectations for a reversal from an established trend entails a high degree of risk because transitions from one sentiment into another are typically characterised by heightened volatility. That is why it is of pivotal importance to spot the boundaries of the last upswing, which will allow for more precise trade execution.

Profit & Loss
Short Term Long Term Net % Gains
+ - + -
2.68 USD 0.95 USD 0 0
2.85%
Short Term
+ -
2.68 USD 0.95 USD
Long Term
+ -
0 0
Net % Gains
2.85%

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