Oil prices rose during the Asian trading period on Tuesday before retreating again a little while ago.
WTI crude oil is still trading near its highest level in three weeks amid various market influences, the main factors include tensions in the Middle East and the recovery of oil demand in China.
Increasing geopolitical tensions in the Middle East, especially Houthi attacks on shipping lines, have affected oil prices.
Recent attacks by the Houthis on shipping lanes in the Red Sea and the Bab al-Mandeb Strait have increased, as at least four other ships have been hit by drones and missiles since last Friday, and the Houthis announced on Monday that one of these ships that was hit is at risk of sinking in the Gulf of Aden, the Belize-flagged and British-registered cargo ship robimar, which increases the risks in their campaign to disrupt global shipping in solidarity with the Palestinians in Gaza.
At the same time, stronger demand in China, manifested in a 47.3% increase in tourism revenues and a reduction in mortgage rates to support its economy, had a positive impact on market sentiment.
However, despite these positive factors, concerns still remain, especially after the recent IEA report, which predicted a decline in oil demand growth due to the rise of renewable energy over market expectations, in addition, the strength of the US dollar and its impact on oil prices as a dollar-denominated asset, which may affect oil's rises somewhat.
Technically: - crude oil is trading near its highest levels in 3 weeks, trying to break through the neckline of the inverted head and shoulders pattern, which is centered near the levels of 79.00 dollars per barrel, where we expect in case of breaking through the neck with a daily candle and closing above, the next targets will be at the levels of 81.00 dollars as an initial target and then the levels of 87.00 to complete the harmonic bat model supported by the 200 Simple and exponential moving average at the daily level above which oil is currently trading.
Any close of the lower moving average will be approximately below 77.40 USD / barrel; the correction could extend to the levels of 76.00 and then 74.00 USD / barrel before returning again to the upside.
