Brent Oil increased in the previous week, but the rebound was stopped by a dynamic resistance and now it was turned to the downside. Price is trading in the red on the short term and seems unstoppable. It remains to see what will really happen because the rate is approaching two important support levels, where it could find support again. Right now is premature to say that the upside movement is completed because the current drop could be only temporary.

Maybe the price also dropped because the Loonie lost significant ground versus the greenback, the USD/CAD has reached new highs as the USDX has increased further and has reached new highs. It remains to see what will happen in the upcoming hours on the dollar index, which is pressuring a resistance area, it will increase further if will have enough energy to stabilize above the 90.70 psychological level.

The Oil price dropped also because the Crude Oil Inventories have increased more than expected in the previous week, it was reported at 3.0M, beating the 2.4M estimate. The Crude Levels have jumped in the positive territory. The USD’s impressive rally could force the oil price to drop much deeper in the upcoming days, as you already know a stronger dollar makes the oil much expensive for the international buyer’s from outside the United States.

The rate has plunged after the false breakout above the lower median line (lml) of the minor ascending pitchfork and now should reach the 150% Fibonacci line (ascending dotted line). A valid breakdown below the 150% Fibonacci line will confirm a further drop at least till the SL2 of the major ascending pitchfork.

It could also be attracted by the median line (ML) of the major blue ascending pitchfork after the failure to approach and reach the 50% Fibonacci line (ascending dotted line).