London Brent Oil
Delayed - 06/21 08:06:01 am

Flat annual performance

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12/12/2012 | 05:06 pm
Opinion : Bearish under 111.7 
Target price : 100.7 
After a good start in the beginning of the year (four years highs near 128.5 USD), Brent has had a difficult year. He has lost nearly 30% between its highs in March and the mid-June lowest before consolidating in an area 105/116 USD during the second half of the year.

The annual performance is mixed on the “black gold” which closed the year near the equilibrium and that after three years of substantial growth.

The economic slowdown leads to lower oil consumption. In addition, for 2013, the forecast demand for oil (including OPEC) is not encouraging. They are around 10,000 bbl / day less than the daily average recorded in 2012 (770,000 bbl / day).

The global economic situation will be a major element to follow in 2013. Indeed, only an economic recovery in developed countries and / or emerging countries could help a new bullish momentum in the coming months. For the moment, this is not the case, and we have a neutral / bearish bias for the beginning of the year.

Last month our opinion was bearish on Brent, which has been a favorable scenario for all investors who follow us. The target of USD 96 has not been reached but the underlying trend remained downward. A short-term resistance zone was formed at USD 111.7 and daily moving averages that converge near the USD 110 back down. This situation calls for a continuation of the downward direction of USD 102.8 (support area relevant in weekly data).
Therefore, we maintain our bearish positions open in the previous month to USD 105.7 and USD 102.8 to target and by extension USD 96, a level corresponding to the lower limit of the bevel weekly.
Etienne Veber
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