4 November 2025,06:19
Daily Market Analysis New
4 November 2025, 06:19
Key Takeaways:
*Oil prices are supported by OPEC+’s commitment to price stability, with expectations that it will maintain its current production strategy heading into its December meeting, prioritizing supply discipline amid uncertain demand.
*A modest recovery in Chinese manufacturing activity, as shown by PMI data, provides a buffer for oil prices, signaling that China may continue to restock inventories through the winter months.
*A stronger U.S. dollar and high global borrowing costs have kept speculative demand in check, preventing oil from gaining significant upside momentum despite the positive supply-side outlook.
Market Summary:
Oil prices traded sideways on Tuesday as markets weighed supply optimism from OPEC+ against persistent macro headwinds from a strong U.S. dollar and high global borrowing costs. Brent crude hovered near $66 per barrel, while WTI held around $61, supported by expectations that OPEC+ will maintain its current production strategy into its December meeting. The group has repeatedly emphasized its commitment to price stability amid uncertain demand conditions, signaling limited appetite for significant output changes in the near term.
On the demand front, signs of a modest recovery in Chinese manufacturing activity provided some cushion to prices. Recent PMI data suggested improving output and export demand, hinting that China may continue restocking inventories through winter. However, broader risk sentiment remains restrained as a firmer U.S. dollar and higher interest rates reduce speculative appetite for commodities. This tightening macro backdrop has limited crude’s upside despite supportive supply dynamics.
Meanwhile, API data showed a larger-than-expected build in U.S. crude inventories, dampening short-term bullish sentiment. Traders now await official EIA figures to confirm the trend. Continued inventory builds and a strong dollar could cap near-term gains, while renewed geopolitical risks or tighter OPEC+ compliance could quickly shift sentiment back toward the upside. Overall, oil remains range-bound, supported by supply discipline but constrained by macroeconomic uncertainty.
Technical Analysis
USOIL, H4:
Based on the chart, the price is currently trading within a descending channel pattern. This indicates a clear downtrend since the beginning of October, with price fluctuations constrained between parallel trendlines. Recently, the price has shown signs of consolidation around the middle of the channel, near $60.00, where the 20- and 50-period moving averages are converging. This suggests that oil is in a tight range awaiting a potential breakout.
From a momentum perspective, the RSI remains neutral at 54, indicating a lack of clear buying or selling pressure, while the MACD is showing mild bullish momentum, with the histogram slightly positive. A break above $61.90 could see price test the upper trendline and possibly extend to $63.30, whereas a break below $60.10 would signal further downside towards the $58.30 support zone.
Overall, the market is in a watch-and-wait mode, and the next significant move will depend on whether oil can break through key resistance or support levels.
Resistance Levels: 61.90, 63.30
Support Levels: 60.10, 58.30
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