This week Brent crude oil significantly strengthened after the publication of poor macroeconomic data from the US last Friday.
At the same time, increased uncertainty regarding an interest rate hike in the US before the end of the year pressures the USD and supports oil prices. In addition, risk appetite is growing on the market.
Furthermore, the price of oil is strengthening prior to the publication of oil reserves change in the US by the EIA. Experts forecast the EIA Crude Oil Stock change for the last week to fall from 3.955 million to 1.750 million barrels.
Support and resistance
Bollinger Bands on the daily chart is trying to turn up, while the price range is widening. The indicator formed a sell signal as the price has left the upper border of the range. MACD is growing and giving a buy signal. Stochastic reached its critical levels in the overbought zone thus indicating a possibility of a downward correction shortly.
The indicators recommend waiting for clearer trading signals.
Support levels: 52.15 (local low), 51.50, 50.89, 50.00 (psychologically important level), 49.13, 48.35, 47.41, 46.80 (2 October low), 46.00 (14 September low), 45.00, 43.97.
Resistance levels: 53.00 (local high), 53.50, 54.16 (31 August high), 55.00, 55.73, 56.50.
Long positions can be opened from the current price with the target at 54.00 and stop-loss at 52.00. Validity – 1-2 days.
Pending sell orders can be placed in the range 52.15-53.00 with the target at 50.90 and stop-loss at 53.60. Validity – 2-3 days.