Commodities

Technical Analysis – Brent crude oil futures advance, posting bullish correction in short term

Posted on January 4, 2019 at 11:46 am GMT

Melina Deltas, XM Investment Research Desk

Brent crude oil futures with delivery in March 2019 have rebounded after falling to a fresh 16-month low of 50.00 on December 26. The momentum indicators are suggesting that the market sentiment might get even better as the MACD is strengthening its movement above the trigger and zero lines, while the RSI indicator is flattening near the 70 level.

Should the price move higher, it would increase the chances for an extension of the bullish correction but would first face immediate resistance at the 58.10 barrier. Above that, the area around 59.50 which halted downside movements several times in the past could be another potential hurdle in focus.

On the flipside, if the price manages to drop again below 56.50, nearby support could come from the 20- and 40- simple moving averages (SMAs) at 54.72 and 54.09 respectively. A decisive close below the latter levels would drive the price towards the 52.00 – 52.50 support area.

In the short-term picture, the price is ready to set the third consecutive green day, however, looking at the bigger view, Brent remains in a downtrend following the bounce off 86.70.

brent crude commodities

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