What Happened
Oil markets have eased in recent sessions, offering traders some breathing room after a volatile stretch. But TD Securities’ Senior Commodity Strategist Ryan McKay isn’t buying the calm. McKay is warning that Brent crude — currently trading around the mid-$60s to low-$70s range — could still spike to $150 per barrel or higher if supply disruptions materialise. WTI crude, the US benchmark closely tracked by Australian commodity traders, is trading in a similar range and would follow Brent sharply higher in such a scenario.
Key Levels
- Support 1: $62.00/bbl — recent swing low and key demand zone
- Support 2: $58.50/bbl — major structural support from 2023 base
- Resistance 1: $76.00/bbl — short-term ceiling where sellers have stepped in
- Resistance 2: $83.50/bbl — prior consolidation zone and 200-day moving average region
Technical Picture
WTI and Brent are both trading below their 200-day moving averages, which is a bearish signal for trend-followers. The short-term trend remains downward since the April highs. However, RSI on the daily chart is hovering near oversold territory (around 35–40), which can signal that a short-term bounce or consolidation is building. A sustained move back above $76.00 would shift the near-term picture to neutral.
What Traders Are Watching
- A close above $76.00 on Brent would be the first sign bulls are regaining control and could invite momentum buyers back in.
- Any escalation in Middle East supply disruptions or OPEC+ production cuts could act as the trigger for TD Securities’ extreme upside scenario toward $150.
- A break below $62.00 would open the door to $58.50 and signal the bearish trend is accelerating.
Bias
Neutral to cautiously bullish on a longer-term horizon. The short-term technicals are weak, but TD Securities’ warning of a potential supply shock means the risk is skewed to the upside. Traders exposed to energy stocks on the ASX — including Woodside and Santos — should keep a close eye on oil levels, as a spike toward $80+ would be a meaningful positive catalyst.
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