BRENT CRUDE OIL ANALISIS - DAILY (1 MARCH 2021)
Following almost the 3-month long period of correction, the Brent eventually violated above the descending channel on 9-Nov-20, and it has indeed reached several Fibonacci Extension (FE) projections as below:
1) USD47.54 (38.2% FE) on 23-Nov-20
2) USD51.14 (50%FE) on 10-Dec-20
3) USD54.75 (61.8%) on 6-Jan-21
4) USD66.42 (100% FE) on 23-Feb-21
Currently, the uptrend is supported by the rising 20, 50, 100 & 200-day Exponential Moving Average (EMA) and green-kumo. Despite several attempts to move lower, the buying interest kept evolving, hence maintaining its medium-term bullish outlook.
Based on this positive momentum, it was earlier expected the Brent to continue climbing higher and challenge the next resistance at USD70, after an initial breakout of 100%FE at USD66.42. However, it reversed thereafter, potentially it was a failed breakout.
Hence, a new technical assessment to seek the potential upside and overall risk for Brent. At this juncture, there are two likelihoods:
A) Bearish bias: The pace of increase is likely to be sluggish due to the emergence of evening star candlestick pattern (from 24-Feb to 26-Feb), which may signal the slowing down of upward momentum. The pattern ended with the formation of a bearish Marubozu candle on 26-Feb-2021. If Brent breaches below than USD63.75 – USD62.78 (Support Zone), which the latter coincides with 20-day-EMA, Brent may lay down the foundation for a new downtrend and this will cap off the potential further bullish movement.
B) Bullish bias: The sharp reversal is halted by the critical 61.8% Fibonacci Retracement support level, and the rising RSI trendline has stopped the downward momentum to decelerate further. Hence, it may be considered as a normal setback as the overall trend remains upward. Resistance levels:
1) Brent has to re-test USD66.22 (100% FE)
2) USD70 – key psychological level
3) USD71.38. USD73.76, USD75.86 – next higher peaks (Resistance zone)
4) USD80 – next key psychological level
5) USD85.30 (161.8% FE) which almost coincides with USD86.82, the highest price in Oct-2018 before Brent started its downward movement earlier.
1) USD47.54 (38.2% FE) on 23-Nov-20
2) USD51.14 (50%FE) on 10-Dec-20
3) USD54.75 (61.8%) on 6-Jan-21
4) USD66.42 (100% FE) on 23-Feb-21
Currently, the uptrend is supported by the rising 20, 50, 100 & 200-day Exponential Moving Average (EMA) and green-kumo. Despite several attempts to move lower, the buying interest kept evolving, hence maintaining its medium-term bullish outlook.
Based on this positive momentum, it was earlier expected the Brent to continue climbing higher and challenge the next resistance at USD70, after an initial breakout of 100%FE at USD66.42. However, it reversed thereafter, potentially it was a failed breakout.
Hence, a new technical assessment to seek the potential upside and overall risk for Brent. At this juncture, there are two likelihoods:
A) Bearish bias: The pace of increase is likely to be sluggish due to the emergence of evening star candlestick pattern (from 24-Feb to 26-Feb), which may signal the slowing down of upward momentum. The pattern ended with the formation of a bearish Marubozu candle on 26-Feb-2021. If Brent breaches below than USD63.75 – USD62.78 (Support Zone), which the latter coincides with 20-day-EMA, Brent may lay down the foundation for a new downtrend and this will cap off the potential further bullish movement.
B) Bullish bias: The sharp reversal is halted by the critical 61.8% Fibonacci Retracement support level, and the rising RSI trendline has stopped the downward momentum to decelerate further. Hence, it may be considered as a normal setback as the overall trend remains upward. Resistance levels:
1) Brent has to re-test USD66.22 (100% FE)
2) USD70 – key psychological level
3) USD71.38. USD73.76, USD75.86 – next higher peaks (Resistance zone)
4) USD80 – next key psychological level
5) USD85.30 (161.8% FE) which almost coincides with USD86.82, the highest price in Oct-2018 before Brent started its downward movement earlier.