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Brent Crude Oil Price Update – Strong Upside Bias with Initial Target $118.95, Followed by $123.25

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Brent crude oil futures closed higher on Friday after Bank of America (BofA) Global Research said the global oil benchmark could rise past $150 a barrel if there is a sharp contraction in Russian oil exports.

Oil prices spiked higher in March after Russian’s Ukraine invasion, which Moscow calls a “special operation”, and are currently sitting within striking distance of the highs reached on March 7 and 8.

On Friday, August Brent crude oil settled at $115.56, up $1.39 or +1.20%. The United States Oil Fund ETF (USO) finished at $85.43, up $0.84 or +0.99%.

“With our $120/bbl Brent target now in sight, we believe that a sharp contraction in Russian oil exports could … push Brent well past $150/bbl,” the bank said in a research note.

Daily August Brent Crude Oil
Daily August Brent Crude Oil

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through Friday’s high at $115.80 will signal a resumption of the uptrend. A move through the next main top at $118.95 will reaffirm the uptrend. The main trend will change to down if $103.89 fails to hold.

The short-term range is $118.95 to $91.98. Its retracement zone at $108.65 to $105.47 is the nearest support. It’s also controlling the near-term direction of the market.

Short-Term Outlook

Trader reaction to $115.80 and $115.56 will likely determine the direction of the August Brent crude oil futures contract early Monday.

Bullish Scenario

A sustained move over $115.80 will indicate the presence of buyers. If this move creates enough upside momentum then look for a surge into the March 8 main top at $118.95. Taking out this level could extend the rally into the July futures contract high at $123.25.

Bearish Scenario

A sustained move under $115.56 will signal the presence of sellers. If this move generates enough downside momentum, we could see a near-term correction into $108.65 – $105.47. Since the main trend is up, buyers are likely to come in on a test of this area.

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire

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