Oil prices were fairly steady on Monday as investors took stock of a busy week for US economic data and central bank action last week, which saw the Brent oil prices swing dramatically within a relatively tight range.
Having traded between $82 – $59 this year, the Brent trading range is beginning to tighten, reflecting a greater uncertainty about the medium-term outlook for global growth and geopolitical developments.
Disappointing US Non-Farm payrolls released on Friday, and news over the weekend that OPEC would ramp up production, weighed on Brent prices on Monday, pulling prices back below $70.
However, the prospect of secondary tariffs on India to curb its purchase of Russian oil provided support prices and kept the recent range intact.
Chris Weston Head of Research at Pepperstone explained that “The technical set-up on the daily timeframe appears somewhat messy and displays no obvious directional trend – that said, the 50-day moving average (in Brent crude futures) does offer some steer to those biased long of crude, with the collective using this medium-term average as a trend filter, with the average containing much of the selling pressure of late, so it does feel like an important guide for our directional assessment – however, for now, the higher timeframe overview shows a market that feels comfortable positioned around $68 to $72 with traders needing to see new intel to force a new trend or a higher volatility regime.”