13, September 2016

Brent (a 4-hour chart)

General overview

Brent prices weakened when the U.S. drillers added oil rigs last week.

Current situation

Brent kept trading lower on Monday. The price broke the 47.50 level and is approaching the next one – 46.50. The instrument was able to regain the 47.50 level and continued its recovery during the North American hours. The price broke the 50-EMA during the European trades on Monday. Now the oil prices are sandwiched between the 50 and 200 EMAs. The 50 and 100 Day EMAs are turning down, the 200-EMA is neutral. The resistance is at 48.50, the support comes in at 47.50 dollars per barrel.

MACD decreased which confirms the strength of sellers. RSI is approaching oversold area

Trading recommendations

A strong breakdown and close below 46.50 could send prices lower towards 45.30. However, the instrument is oversold and we do not exclude a large correction towards 48.50.