After a few months of selling pressure from containment measures, with a view to curbing the spread of the COVID-19 pandemic, which caused an aggressive slowdown in economic activity globally, “black gold” now has room for an appreciation in its price, at least from a technical point of view, since after entering a descending channel in the weekly time-frame, the price broke down its bottom line, which is usually a sign of an inversion in the short- term, and shortly afterwards it regained this line, having already successfully tested this achievement, acting this level as an evident support zone.
At this stage, the price has already broken the highs of the lateralization that it had made a few weeks ago and therefore has an open path for an appreciation up to the top line of the descending channel, which stands at $63 per barrel. In the fundamental component, the scenario is mixed, positive in the short and medium term, due to the gradual resumption of economic activity, but negative in the long term, since the disruption in mobility is now in a phase of strong expansion, namely in China, the largest car market in the world and where the main battery manufacturers in the world are located, with the two largest companies holding about 33% of the market, and the situation only tends to solidify in this area of China, since of the 142 mega factories of batteries for electric vehicles under construction, 107 are in the second largest economy in the world and only 9 in the USA, a strategy that is well known to Chinese officials, the energy transition, so it will be a matter of time before crude is no longer the main product to fuel mobility.
