Naphtha Price Analysis

[Dr.Masih Rezvani + 27]

Naphtha Price Analysis

Summary

Naphtha futures extended their decline to below $660 per tonne in mid-August, a level not seen since Aug 2021 and nearly 50% down froth the decade-high of $1080 hit in early Feb, tracking the slide for other oil-derived commodities as recession concerns pressured crude oil prices.

The decline was exacerbated by poor industrial production data from China for July, pointing to a sluggish restart of economic activity after the strict Covid lockdowns from the second quarter.

Bearish pressure was also due to prolonged signals that central banks intend to continue their hawkish momentum to curb surging inflation in major economies.

Forecast

Main view :

Naphtha is expected to trade at 687.96 USD/T by the end of this quarter, according to Economics global macro models and analysts’ expectations. Looking forward, we estimate it to trade at 750.64 in 12 months’ time.

Technical view

Weekly Chart

Now , Price is struggling in a strong support zone 50% fibo

There are some scenarios

1- if price can break the support then moves down till 450$ (0.68% fibo) then will moves up till channel center line around 900$ / 950$ and it might be continuing uptrend till top of the channel above 1200$

2- head and shoulders pattern, it means, price will move up till 750$/770$, then will fall till under the 400$