Today, we present you a mid-term investment overview of the Brent Crude Oil trading instrument.

Oil market participants are monitoring the political situation in the United States, especially in light of the victory in the presidential election of Republican representative Donald Trump, who previously made a number of statements about significant support for the oil sector. Despite the fact that serious changes in the production and export of "black gold" should not be expected before the official inauguration of the politician, which will take place on January 20, experts already assume that the increase in production volumes in the country will continue. A completely different position is taken by OPEC , which is trying to keep quotes from falling below 70.0 dollars per barrel: the cartel twice extended voluntary production cuts by the parties to the agreement by 2.2 million barrels per day. Currently, the start date for the gradual increase in production is January 1, 2025, but it will probably not be possible to implement this plan even at the beginning of next year, since a number of countries this year have a significant excess of quotas, which has not yet been compensated in any way. In early November, Russia and Kazakhstan presented new OPEC regulations, which, however, do not imply a quick exit to the required levels. Despite the fact that, taking into account all quotas, the OPEC production limit is 39.425 million barrels of oil per day, in October this figure amounted to 41.02 million barrels per day. That is why most experts believe that OPEC will postpone the timing of volume adjustments several more times, and the real increase may not begin until the end of spring 2025, which will not have a positive impact on asset quotes.

The fundamental background is indirectly confirmed by the technical one: for a long time the position of the spread between Brent Crude Oil and WTI Crude Oil has been held in a narrow range of 3.50–4.50. So, on the W1 chart, the price is trying to move away from the resistance line of the descending channel with the boundaries of 77.00–40.00 and is approaching the annual minimum of 70.20.

At the moment, the quotes have almost reached an annual low of 70.20, consolidation below which will be a key marker for the continuation of the downtrend, which temporarily stopped at the end of summer.

Key levels can be seen on the D1 chart.

As can be seen on the chart, the price is held within the framework of the "head and shoulders" pattern, being close to the "neck" line at 69.20, the implementation target of which is the support line of the 64.00 channel.

In the area of one of the highs of mid-September 2024, at 79.50, there is a zone of cancellation of the sell signal; if it is reached and after the subsequent increase, the downward scenario will either be canceled or noticeably delayed in time, and open positions should be liquidated.

There is a target zone near the support line of the channel at around 50.00' if it is reached, profit should be taken on open short positions.

In more detail, trade entry levels can be evaluated on the H4 chart.

The entry level to sell transactions is located at 69.20, which coincides with the minimum of September 10, and a signal can be received as early as this month. Technically, a breakdown of this level will be implemented, after which there will be no significant barriers on the price's path to the target mark of 50.00 and positions can be implemented.

Given the average daily volatility of the trading instrument over the past month, which is 1026 points, the price movement to the target zone of 50.00 may take approximately 59 trading sessions, however, with increased dynamics, this time may be reduced to 49 trading days.