The price of Brent crude oil continues falling renewing its 2004 lows.
The price is pressured by poor macroeconomic statistics from China that show that the economy of the country is slowing. The Caixin China Services PMI for December fell from 51.2 to 50.2 points, which was its lowest figure for 17 months.
At the same time, latest data from the US showed an unexpected fall in crude oil reserves by 5.1 million barrels, though Distillates and Gasoline Stocks grew by 10.6 million and 6.3 million barrels respectively that was significantly better than expectations.
Support and resistance
Bollinger Bands on the daily chart is turning down while the price range is widening. At the same time, the indicator formed a signal for correctional growth as the price has left the lower border of the range. MACD is falling and giving a strong sell signal. Stochastic is at its critical levels in the oversold zone.
The indicators recommend waiting for clearer trading signals.
Support levels: 33.00 (local low), 32.50, 32.00 (2004 lows).
Resistance levels: 34.00 (local high), 35.00, 36.85 (22 December low), 36.20, 37.00, 38.00, 38.77 (4 January high), 39.44.
Short positions can be opened from current prices with the target at 31.95 and stop-loss at 34.40. Validity – 1-3 days.
Long positions can be opened after the breakout of the level of 35.50 with the target at 37.00 and stop-loss at 33.00. Validity – 1-2 days.