Brent Oil rebounded and recovered after the impressive drop. The rate has found strong demand near the 62.50 psychological level and now is almost to reach a static resistance. It remains to see if the corrective phase is really completed, maybe this will be only a temporary rebound and the rate will drop again soon.
Price increased sharply in the last hours as the United States Crude Oil Inventories have disappointed in the afternoon. You should know that the perspective remains bullish on the medium to the long term, so the last drop could be only temporary.
The corrective phase was natural after the impressive rally, it has reached a very strong resistance area, has retested it and has signaled that is too overbought to climb much higher.
The Oil rallied also because the USD/CAD has plunged aggressively after the poor US data, a further drop will send the oil much higher.
The Crude Oil Inventories were reported at 1.8 million barrels in the previous week, much below the 2.8M estimate and below the 1.9m in the former reading period.
The price has found strong support at the second sliding line (SL2) of the major ascending pitchfork and now could reach the $65.00 again in the upcoming hours. It has failed to reach the first sliding line (SL1) and to stabilize below the 150% Fibonacci line.
Technically, it is expected to approach and retest the lower median line (lml) of the minor blue ascending pitchfork. A failure to reach this line or a rejection of it will signal another drop. Personally, I was expecting to see a drop toward the 60.00 psychological level after the retest of the 50% Fibonacci line and the 100% Fibonacci level, this scenario could still happen in the upcoming weeks.