With mixed economic data muddying the waters, crude oil is caught between a rock and a hard place. While supply constraints continue to reduce inventories, rising interest rates have slowed economic growth and could suppress demand.
However, famed oil trader Pierre Andurand is betting on the former, commenting on Oct. 24 that “the market will have to beg for more supply at some point…. The Saudis will have to decide when and at what price to bring supply back,” he added. “For me, an adjustment likely will come around $110 a barrel.”
And though the hedge fund manager believes “there’s room to the upside,” key technical levels could decide whether the bulls or bears win this battle.
For example, crude’s 50-week moving average acted as resistance during the October and November 2022 upswings and provided support during the August 2023 pullback. Therefore, with the milestone near $78, a breakdown could send crude tumbling to its 200-week MA.