Crude oil prices slumped last week. Brent crude oil futures on the Intercontinental Exchange (ICE) ($64.50/barrel) and crude oil futures in the domestic market (₹5,439/barrel) lost 6.8 per cent each. Here is the analysis and trade recommendation:
Brent futures ($64.50)
Brent crude oil futures breached an important support at $65.50 last week, turning the outlook weak. Prior to this, it was consolidating between $65.50 and $69 since early August.
Although there might be an uptick from the current level, it is likely to be only a corrective one. This can be restricted to the $66-67 region, where both 21- and 50-day moving averages coincide.
Notable support levels can be spotted at $62 and $58.50.
Overall, Brent futures appears bearish and this can weigh on the crude oil futures contract on the domestic market, too.
MCX-Crude oil (₹5,439)
Crude oil futures (October) fell off the barrier at ₹5,850. It dropped through last week and slipped below the trendline support at ₹5,500 on Friday.
That said, there is a support nearby from the current level at ₹5,380. As the Brent crude oil futures has turned bearish after falling below a key base, the MCX crude oil futures is likely to decline below ₹5,380.
A breach of ₹5,380 can open the door for a downswing to ₹5,000. Support below ₹5,000 is at ₹4,800.
On the other hand, if the contract recovers from the current level, it is unlikely to go beyond the hurdle at ₹5,600 where both 21- and 50-day moving averages coincide.
Overall, the October contract might rise to ₹5,600 but we expect it to eventually fall to ₹5,000 before the expiry, which is on October 20.
Trade strategy: Short crude oil futures (October) at ₹5,450 and ₹5,550. Place initial stop-loss at ₹5,650. When the contract falls to ₹5,200, revise the stop-loss to ₹5,450. Exit at ₹5,000.
Published on October 4, 2025