Daily Analysis UKOIL 25 Apr 2023

Oil prices are showing some gains in Europen trade, boosted by China's economic rebound and expectations for the upcoming release of the 1Q U.S. GDP reading. Despite this, the market is still waiting for clearer signals on Chinese demand. Brent crude, the international oil benchmark, is holding steady at $82.50 a barrel. Analysts are hopeful that China's upcoming week-long holiday could offer clues to the strength of Chinese consumers' demand for travel, which is crucial for oil demand. Data from a major Chinese travel firm cited by Reuters shows that holiday bookings for international trips during the period are up 157% so far. Monday's weaker-than-expected U.S. economic news signals a slowdown in the economy that is bearish for fuel demand. The U.S. Apr Dallas Fed manufacturing activity index unexpectedly fell -7.7 to a 9-month low of -23.4, weaker than expectations of an increase to -12.0. 

From a technical perspective, the commodity has closed the price gap and touched its last support level. A correction occurred, which brought the price back to the 79 support level, which has now become a new resistance level. If there is any rejection of this level, it will indicate that more selloffs are on the horizon, especially if economic data fails to deliver the promised rebound in demand.

Support: 80.80 – 79.00 – 77.00        Resistance: 83.60 – 85.00 – 86.40