Brent crude price rises over 5% as risk appetite returns despite easing geopolitical tensions

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Brent crude rises 5.02% today

Highlights

Brent crude fell more than 20% from its late-October high to a two-month low after the U.S. midterm elections reduced geopolitical risk premiums.
The largest single-day drop since May occurred on November 4, as market participants reassessed Iran-related tensions.
Technical analysis indicates Brent crude remains under short- and medium-term pressure with a projected five-day range of $87.84 to $108.68, and 71% probability of further downside.

Oil declines accelerate as U.S. election eases geopolitical risk premium

International oil prices have fallen sharply since the U.S. midterm elections, where Democrats secured both the House and Senate, prompting market participants to anticipate lower geopolitical risk premiums, particularly those related to tensions involving Iran. Brent crude declined by more than 20% from its late-October high, reaching a low not seen in over two months. On November 4, Brent crude reportedly saw its largest single-day drop since May.

Anton Kharitonov, expert at Traders Union, notes that Brent's 5.02% rebound comes despite a weakened geopolitical risk premium and precedes major resistance. He highlights the asset’s failure to recover its 20-day or 50-day moving averages as a sign of vulnerability. Macro sentiment remains fragile after recent political developments and the sharp decline since October. Technical indicators suggest indecision, with selling pressure not yet decisively exhausted. "There is a significant risk of downside resumption if Brent fails to stay above key support, and I advise caution for late buyers," says Kharitonov.

Viktoras Karapetjanc, expert at Traders Union, maintains a constructive take on Brent’s structure despite recent corrections. He emphasizes that the bullish long-term signal from the 50-day and 200-day moving averages remains intact. Recent news has reduced risk premiums, but this creates potential for renewed buyer interest if macro conditions stabilize. Volatility provides opportunities for active participants. "Brent still offers solid setups for upward continuation if resistance at $103.89 is cleared, and I expect further growth in that scenario," Karapetjanc states.

Jainam Mehta, market strategist, sees Brent’s current range as a battleground between waning selling momentum and strong, event-driven bounces. The analyst notes mixed signals across MACD, RSI, and Stochastic RSI, underscoring uncertainty ahead. Mehta suggests tactical traders watch for a breakout or a failed test of support around $98.25. "A sudden surge above $103.89 could present a tactical long, but I would be quick to reverse if momentum stalls," he advises.

Technical pressure persists as oversold signals suggest rebound risk

XBR/USD is trading below both its 20-day ($109.58) and 50-day ($103.89) moving averages, highlighting ongoing short- and medium-term pressure, but it remains above the 200-day ($95.67), which provides longer-term support. Immediate resistance stands at $103.89, with support near today's high at $98.25. The longer-term alignment of the 50-day and 200-day averages remains bullish. Momentum signals are mixed: the MACD is neutral, the ADX indicates a sell bias, the RSI is neutral, while the Stochastic RSI and CCI are both in the oversold zone, suggesting the potential for selling exhaustion and a possible rebound. Intraday, sellers still dominate according to negative BBP, but strong volatility and a pronounced price gain show strong buying interest into resistance.

Previously, analysts noted that geopolitical risks and volatility continued to drive oil markets, with persistent uncertainty surrounding Middle East tensions and supply disruptions. Now, with technical levels converging and mixed momentum signals, traders should closely watch for a decisive move above $103.89 or below $87.84 as the next catalyst for Brent crude's direction.

Source of Data: XBR Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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