After a substantial growth in the beginning of October to $54 per barrel, the price of Brent crude oil sharply fell in the middle of the month.
The main pressure on prices came from China where its GDP growth continues slowing while the country remains one of the key oil consumers. In addition, the price was pressured by statements from Iran regarding a possibility to increase its oil output by half a million barrels a day in the nearest future.
Important events that needs to be watched in the short-term are data on Crude Oil Stocks Change in the US and the OPEC meeting on production quotes for member countries.
Support and resistance
In the medium-term, a further fall in the price along a downward channel to the levels of 47.25, 46.90 and 46.30 (September lows) is expected.
However, a breakdown of the level of 46.30 and a price exit from the sideways channel is unlikely. More probable is the price rebound from this level and its growth towards 49.70, 50.05.
MACD indicator is in the negative zone and its volumes are growing, confirming a fall continuation.
Support levels: 47.85, 47.25, 46.90, 46.30, 45.25, 44.70.
Resistance levels: 48.70, 49.15, 49.70, 50.05, 51.25, 53.00, 54.00.
Short positions can be opened from current prices with the target at 46.40 and stop-loss at 49.50.