Brent oil prices are forming a new medium-term technical range, with the lower boundary at $61.3 per barrel and the upper boundary at $68.0. The midpoint of this range will likely hover around $64.50. The lower and upper boundaries represent support and resistance levels that have not been retested.
Yesterday's correction allowed the market to blow off steam after oil prices had been relentlessly trending in one direction without any pullbacks, creating a coiled-spring effect. When this tension reached its limit, we finally got a price release. In other words, this was purely a technical correction. All the fundamental macroeconomic headwinds remain firmly in place. The trade war drags on, global production is set to contract, and demand for commodities, as well as for oil, will keep declining. These factors will continue weighing on oil prices, including Brent crude.
Returning to the technical picture, Brent crude now needs to gather momentum and consolidate within the previously mentioned $61.30–$68.00 per barrel range. Considering the continuation of the bearish scenario, the best approach would be to enter sell trades when Brent prices approach the upper boundary of $68. Closing trades is recommended around the mid−range level of $64.5.
The overall recommendation is to sell Brent oil from the level of $68.0 per barrel.
Profits should be taken at the level of $64.5. A Stop loss could be set at the level of $72.00.
The volume of the opened position should be set in such a way that the value of a possible loss, fixed with the help of a protective Stop loss order, is no more than 1% of your deposit funds.
This content is for informational purposes only and is not intended to be investing advice.
