Crude oil prices were down last week. The Brent crude oil futures on the Intercontinental Exchange (ICE) ($65.80/barrel) lost 3.2 per cent. Whereas the crude oil futures on the MCX (₹5,396/barrel) depreciated 1.5 per cent.
Brent futures ($65.80)
Brent crude oil futures, largely due to the decline that happened mid-week, posted a weekly loss of 3.2 per cent. It was unable to surpass the barrier at $69.
Going ahead, there might be a drop in price. The nearest support from the current level is at $61. The subsequent support is $56. But note that a breach of the base at $61 will be a considerable bearish signal.
In case the bulls gain traction, it would still have to push the contract above $70.70 to have some hope of reversing the direction of the trend. Resistance above $70.70 is $75.
MCX-Crude oil (₹5,396)
The May crude oil futures, although posted a loss of 1.5 per cent last week, the price action shows that it remained within a narrow range. The contract oscillated between ₹5,270 and ₹5,500.
Nevertheless, crude oil futures is below the key barrier at ₹5,500, where the 20-day moving average lies. This keeps the inclination bearish for the contract.
A resumption in downtrend from the current level can drag the contract to ₹5,000. A breach of this can intensify the sell-off. Nearest support below ₹5,000 is at ₹4,400.
In case crude oil futures break out of ₹5,500, it can extend the rally to ₹5,800, a notable resistance. Above this lies the key hurdle of ₹6,000. Only a breach of this can lead to a sustainable uptrend.
Trade strategy: Sell May crude oil futures for ₹5,400. Target and stop-loss can be ₹5,000 and ₹5,600 respectively.
Published on April 26, 2025
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