The Brent Oil has decreased further since last week, the price has reached the 44.05 level in yesterday’s trading session, has found temporary support at this level and now is struggling to bounce back and to recover after the last drop. The rate is located right above a strong confluence area, any rejection here will push the price higher again on the short term, we could see another bullish momentum in the coming period before the price will resume the correction phase, my opinion is that the price could drop further, at least till will reach the 42.46 static support. Probably the rate will move significantly later after the United States will release the Crude Oil Inventories report, the Crude Levels could drop again in the previous week to -2.1 million barrels, the economic indicator stay deep in the negative territory from May, but the Oil wasn’t inspired by the latest drops, however the rate could increase a little today if the data will come in line with expectations or worse.
The Bret Oil has found temporary support right above the 38.2% retracement level, the downward was stopped by the sliding line (minor descending dotted line), the price has decreased inside the minor descending pitchfork, but the rate has failed to drop below the sliding parallel line, personally I’m expecting to see the price at the confluence area formed at the intersection of he 38.2% retracement level with the second warning line (wl1), any test of this confluence area followed by an increase will attract the buyers again, the price could increase again if the warning line (wl2) will hold, we’ll have to wait till will have a clear signal, because any drop below the confluence area could opent he door for more declines in the coming period.
We’ll have a broader decrease only if the price will slip below the 42.46 horizontal support, otherwise the rate could bounce back from the mentioned support levels, however the Brent Oil could take a blow even from today if the Federal Reserve will take action tonight, a US dollar rally will send the Oil much deeper.