Crude oil Brent continues to decline. The price has already dropped below the level of $66 per barrel, which is the lowest level over the past five years. The main reasons of decline do not vary: these are the increase in production and decrease in demand. Additional pressure on the oil prices was caused by the forecast from Morgan Stanley analysts. They predict that next year oil prices will go down to 43 USD per barrel. Most experts believe that Brent price is not going to rise significantly in the near future. Today, on 9 December, economic calendar does not contain macro-economic statistics, which can change dynamics of Brent. Therefore, technical analysis will be of higher importance.
Support and resistance
Following long-term decline, the pair may temporarily go up as part of correction. On the four-hour chart the price has broken down the bottom line of "Bollinger bands", which confirms probability of the short-term upward correction to the level of 66.70. However, in general, downtrend will prevail. MACD histogram is in the negative zone; its volumes are increasing.
Resistance levels: 66.00, 66.70, 67.52 and 68.70.
Support levels: 65.00, 64.00, 63.00 and 62.00.
Buy positions can be opened after breakdown of the level of 66.00 with the target of 66.70. Following steady breakdown of the level of 66.70, the “bulls” will try to break down the level of 67.62. From this level large sellers will become active. It is recommended to place pending sell order (Sell Limit) at the level of 67.62
Analyst of LiteForex Investments LimitedPublication source