Crude oil prices spike by 5.5% amidst geopolitical tensions and speculation

Geopolitical events that occurred during the weekend boosted the prices of crude oil and gold, leaving traders to speculate on future market movements. 
 

Although Brent crude oil prices experienced a 5.5% spike in the last 24 hours, they didn't surpass the previous week's high, leaving the multi-week outlook untouched.  
 

Today, Brent crude oil prices remained trapped between the September high of $96.06 and the August low of $81.58. 
 

As the US workforce returns from holiday tomorrow, we will see if traders make more significant changes in their portfolios, but for now, the markets are swiftly calming down. The focus is also once more on the Federal Reserve. 
 

Heading into the NFPs, the expectations were for the Federal Reserve to keep rates higher for longer. As the NFP data was released and we saw 336K new jobs created vs the 171K expected, the view is cemented that the Fed will not be able to relax interest rates any time soon.  
 

The price of crude oil will, therefore, probably remain trapped between the September high of $96.06 and the August low of $81.58 over the next few days, with the possibility to slowly drift higher as it resumes its uptrend since summer. 
 

If the price manages to trade below $81.58, then it is likely that the price will seek out the next support level, the June low of $71.86, while if the price remains above $81.58, we might revisit $96.6 in the week ahead. 
 

The next key events to watch are Wednesday’s PPI report, followed by Thursday’s CPI report. Economists expect annual inflation to soften to 3.6% from 3.7% in the prior month. 
 

Get in on the volatility of Crude oil today. Start trading with ThinkMarkets and enjoy spreads as low as 0.02 points. 
 

Brent crude oil daily chart 

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