Crude oil prices tumbled last week. The Brent crude oil futures on the Intercontinental Exchange (ICE) ($65.60/barrel) was down 9.9 per cent. Whereas the crude oil futures on the MCX (₹5,311/barrel) lost 10.7 per cent.

Brent futures ($65.60)

Brent crude oil futures rallied in the first half of last week and marked a high of $75.5 on Wednesday. But it fell sharply for the rest of the week.

The decline resulted in the contract breaching a key support at $69. There is a support ahead at $65.

However, on the back of this, Brent futures can see a temporary corrective rally but not a bullish trend reversal. A fall below $65 can drag it to $58.

In case there is a recovery, only a clear breakout of $77 can bring back the bullishness.

MCX-Crude oil (₹5,311)

The April crude oil futures surpassed the key ₹6,000-mark early last week. However, the rally did not sustain.

The contract, after marking a high of ₹6,182 on Tuesday, fell considerably. It broke the support at ₹5,750 and ₹5,500, a bearish sign. The crude oil futures marked a four-year low of ₹5,219 on Friday before seeing a minor recovery.

That said, from the current level, we are expecting a minor pull back, possibly to ₹5,500 or ₹5,700. Post this move, crude oil futures can resume the decline.

Notable support levels below ₹5,250 are at ₹4,700 and ₹4,300.

For the contract to turn the outlook positive, it should cross over the key resistance level of ₹5,750. Until then, bears will be at an advantage.

Trade strategy: Stay out for now. When crude oil futures rises to ₹5,600 go short with a stop-loss at ₹5,800. Book profits at ₹5,000.

Published on April 5, 2025

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