Crude Oil Is Surging

 | Dec 06, 2021 08:17AM ET

The commodity market is surging in early December. Brent has gained over 2% and is currently trading at $71.35.

h2 Reasons For The Surge In Oil Prices/h2

Investors are processing bad news from Saudi Arabia, which raised prices for January. It may mean that Saudis believe that the demand is stable and will remain stable in the foreseeable future. That's why they are not afraid to raise oil prices. It's a good signal for the commodity market.

Apart from that, a good signal for oil prices is the pause in the US-Iran talks on the nuclear deal. There might be some progress in negotiations, which may help remove oil export restrictions from Iran in the future. This week, the countries are planning to resume talks, and that's very important for oil investors.

h2 Oil Technical View/h2

In the H4 chart, after completing the ascending impulse at 72.86 along with the correction towards 69.50, EUR/USD is expected to return to 72.86 and may later continue trading upwards to reach 77.90. After that, the asset may start a new correction towards 73.65 and then form one more ascending structure with the first target at 81.00.

From the technical point of view, this scenario is confirmed by MACD Oscillator: its signal line is growing towards 0 outside the histogram area. Later, the line is expected to break 0 to the upside and continue moving to reach new highs.