2016-06-24 15:45:25

Review and dynamics
Today, after the referendum in the UK, and the decision of the British people to exit from the EU, global financial markets experience a shock which can be compared with the crisis in 2008. The price of crude oil Brent fell by 3 USD per barrel, reaching $ 47.50 per barrel.

The decline stopped at the level of 47.50 (bottom line of the ascending channel and ЕМА50 on the daily chart). At the moment, the price has consolidated at the level of 48.70 (ЕМА200 on 4-hour chart).

However, pressure on price continues.

Our opinion
Today and in the next few days, oil market will be adjusting to the new conditions.

On 4-hour, daily, weekly charts the indicators OsMA and Stochastic give sell signals.

If the price does not consolidate above the level of 48.70, the decline can continue up to the level of 45.00 (ЕМА144 on the daily chart) and after breakdown of support levels 47.50, 47.00 and 46.20 (Fibonacci 50.0% to the decline from 65.30 to lows of 2016 at 27.05) and 45.70 (ЕМА200 on the daily chart).

Consolidation of the price below the level of 45.00 may trigger further decline to the level of 41.70 (Fibonacci 38.2%), which will confirm downtrend. As an alternative scenario the price may grow above the level of 50.70 (Fibonacci 61.8%).

However, in the current situation, this scenario is not feasible. Based on the existing fundamental factors we recommend to open short positions.

Support levels: 48.70, 48.00, 47.50, 47.00, 46.20, 45.70, 45.00, 44.00, 42.50, 41.70 and 41.00.

Resistance levels: 50.00, 50.70, 51.00, 52.00 and 52.80.

Trading tips
Sell on the market. Stop-Loss: 49.60. Take-Profit: 48.00, 47.50, 47.00, 46.20, 45.70 and 45.00.
Buy positions are not recommended.

In the ascending channel
In the ascending channel

At support level of 48.70
At support level of 48.70