As shown on the XBR/USD chart, Brent crude oil prices surged by over 8.5% last week — marking the largest increase in 2024, driven by escalating tensions in the Middle East.

Although oil prices continued to climb earlier this week, a pullback occurred on Tuesday, causing Brent crude to drop below the $80 level. It appears that market participants expect U.S. authorities to prevent the conflict from worsening ahead of the presidential elections, prompting them to lock in profits from previous long positions based on the technical outlook.

XBR/USD Technical Analysis

Today's analysis of the XBR/USD chart shows that Brent crude is moving within an upward channel (shown in blue) that began in the first half of September. The recent downturn (indicated by an arrow) comes as:

→ The price has entered a resistance zone, marked by the psychological $80 level and the August highs around $81.5.
→ The RSI indicator has risen above 85.
→ The price has touched the upper boundary of the channel.

If tensions in the Middle East ease, we could see a pullback on the XBR/USD chart following the impressive rally.

Brent crude prices may find support at the median line of the blue channel, the $77.50 level, and the purple lines marking last week’s strong price growth.

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