The Brent Oil has decreased significantly today and looks determined to reach fresh new lows in the coming days, the current decrease was expected after the failure to make new highs, the USD/CAD increase has also forced the rate to decrease a little on the short term. The rate looks very heavy on the short term and could drop much deeper, could decrease below the $50.00 psychological level if the Loonie will decrease further versus the greenback. Remains to see how the rate will react tomorrow when the United States will release the Crude Oil Inventories report, the Crude Levels may increase to 0.7 million barrels in the previous week, if the economic indicator will come in line with expectations or better, then the Brent could drop sharply in tomorrow’s trading session.

The Brent has decreased in the previous days also because the US dollar has dominated the currency market, a stronger dollar makes the oil much expansive for the international customers from outside the United States, the USDX has rallied in the previous days and has forced the USD to appreciate versus the other major currencies.

You  can notice that the rate has failed to close right on the 53.03 horizontal resistance, so the current retreat is natural, the rate has failed also the touch the mentioned level, signaling that is too overbought on the short term. Technically, the rate is expected to drop sharply because has failed once again to reach the 61.8% retracement level, has failed also to break above the median line (ML) of the major ascending pitchfork. The price is expected to approach the 50% retracement level in the upcoming days, could find temporary support there, a drop below this level will open the door for more declines, could approach the 38.2% retracement level if will have enough directional energy to take out the confluence formed at the intersection of the 50% retracement level with the fourth warning line (wl4), the rate will be attracted by this confluence if will manage to stay below the third warning line (wl3).