Conflicting Evaluations Of The Oil Markets

The state of uncertainty and acceleration of events affecting oil price movements is the most important event for this week’s trading, and this makes us expect large

fluctuations in price movement in this week’s transactions, and OPEC + had officially approved the extension of the current oil production policy amid a continuous

and cautious assessment of the slowdown in the Chinese economy and increasing concerns about EU sanctions on Russian oil purchases, whether by suspending

them or setting a price ceiling for them.

In addition, Brent oil increased in last week’s transactions by 2.4% and it is stable near the levels of $86 a barrel, ending a decline that continued over the previous

three weeks, and prices struggled to avoid breaking the support levels of $82 a barrel, which are considered an important support levels for prices in the transactions

of the last two months. At the same time, the levels close to 89 dollars appear as resistance levels, given that prices tried to surpass it on two previous occasions.

(Figure 1)

Moving on to the United States, the US job data came as a surprise to the markets after the US economy added jobs in November better than expected despite

the tough cycle of interest rates, as the report showed that the economy added 263 thousand jobs compared to expectations of 200 thousand jobs, while the

unemployment rate remained stable near the lowest levels in 50 years at 3.7% at a time when wages continued to rise and recorded an increase of 6%, and

these numbers do not seem comfortable to the US Federal Reserve simply because they do not constitute evidence of a faster decline in inflation or at least

indicate that inflation has not reached its peak yet, and also raises concerns that Higher costs become entrenched in the economy.

Immediately after the release of the jobs data, the dollar index moved upwards, trying to reach the previous support area of ​​105.2, but soon returned to trade

below it, indicating that the dollar is considered weak if it continues to trade below those levels, and this formed strong support for the rest of the major

currencies as well as commodity and metal prices.

(Figure 2)

And this is how the weekly closings of the most important traded financial instruments came:

(Figure 3)

And as the countdown to the upcoming Fed meeting on December 14 begins, the market's assessment of the path of interest rates is showing a conflict between

optimism about the chance to start slowing down the pace of monetary tightening and negativity about the final interest rate that the Fed will settle at, which it

considers appropriate to lower inflation rates. Until then, however, these two perspectives are in conflict. We outline this week's key financial dates below:

(Figure 4)

We also show through the chart the most important price levels of some traded financial instruments, which are expected to have an important impact on price


First, we will monitor the ability of the Standard & Poor's index to surpass the resistance 4100, which represents an extension of the resistance line of a number of

previous peaks that appeared since the beginning of this year until today.

(Figure 5)

We will also monitor gold's ability to overcome the resistance area near 1805 dollars per ounce and its ability to achieve continuity above those levels, given that

these levels are considered levels that represent a rebound area for prices on several previous occasions.

(Figure 6)

Finally, natural gas prices, which declined by more than 12% last week, are facing selling pressure, especially after breaking the previous support 6.4, which we

will monitor to what extent gas prices will continue to decline.

(Figure 7)

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