Since today’s opening, the price of Brent crude oil remains under pressure amid news from China. The latest industrial profits data showed an annual decline of 8.8%, the biggest fall since 2011. Amongst others, coal (64.9%), metals (51.6%) and oil (67.3%) producers incurred the biggest losses. Main reasons for heavy cuts in profits are prices drop and the Yuan 2.9% devaluation.
Today, attention needs to be paid to FOMC members William Dudley and Charles Evans speeches. In case of commentaries increasing the probability of the rate hike in the US before the end of the year, the USD would strengthen which would lead to growing pressure on oil prices.
Support and resistance
Supportlevels: 47.00 (61.8%Fibonacci), 45.00 (psychologically important level), 42.18 (yesterday low).
Resistancelevels: 49.05 (25 September high), 50.33 (local high), 51.40 (upper MA of Bollinger Bands).
Long positions can be opened above the level of 49.10 with targets at 50.30, 51.40 and stop-loss at 48.80.
Short positions can be opened below the level of 46.90 with targets at 45.00, 42.50 and stop-loss at 47.60.