At Monday’s closing hour, Brent crude oil recovered from lows and closed at 62.70$. A good flight put up by the bulls at 20DMA with Oil closed marginally higher. Lower level buying supported the price, but a decisive breakout needed through the 64$ levels awaits fresh clues.
The weak daily volatility and the bearish turnaround of the daily stochastic should cap the rallies so far. Against this setting, a lasting break of the 63.75-64.00$ key barriers sounds cautious.
A close above 64.00$ can be considered as an initial sign of strength for bulls:
Note, a break above these would rally further towards 65.00$ and 66.30$ initially, followed by 68.50$ and 70.0$ levels.
The supports stand at 61.20$, 60.40$ and 58.90$-59.40$.
Turning to position hedge funds raised net longs, according to the CFTC report. In the week to December 24, Hedge funds and other money managers raised their bullish bets on U.S. crude.
The supply and easing global growth are continuing to raise the volatility over the near and medium term. On top of these, US-China trade talk developments in the week ahead.
It is important to always keep in mind the risks involved in trading with leveraged instruments.
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