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Brent crude futures closed sharply higher on Friday and are poised to rise after reports that the US and China would offer concessions to end the ongoing trade dispute between the US and China. the world's two largest economies. The market was also underpinning reports that OPEC and its allies had cut production in December, one month before the start of the planned production cuts on 1 January.
On Friday, Brent crude oil futures were $ 62.70, up $ 1.52 or + 2.42%. For the week, the market was up $ 2.22 or + 3.54%.
Daily technical badysis
The main trend is upwards according to the daily swing chart. It took almost a month to eliminate short sellers, but the main trend finally changed to strengthen on Friday when buyers took the top of the market at $ 62.47. The new swing background is $ 58.91. An exchange across this level will change the main trend down.
The main range is $ 63.91 to $ 50.31. Negotiating on the strong side of its $ 58.71 to $ 57.11 retracement zone also contributes to the upward bias. This area is a new medium.
The main upward target is the long-term level of 50% at $ 67.88.
Daily technical forecasts
Based on Friday's bullish momentum, the direction of the Brent crude futures contract in March on Monday should be determined by the traders' reaction to the previous high at $ 62.47.
Bullish scenario
A sustained move of over $ 62.47 will indicate the presence of buyers. If this creates enough upward momentum, expect the rally to peak on December 7th at $ 63.91. This is a potential trigger point for an upward acceleration with the next major goal, the 50% level at $ 67.88.
Bearish scenario
The inability to maintain a rebound of more than $ 62.47 will indicate that Friday's change in trend was caused by buy stops rather than aggressive buying. This will also indicate the return of the sellers. This could fuel a short-term retracement of the rally starting at $ 58.91.
The entire recovery will weaken if $ 58.91 fail. However, do not expect a downward acceleration as long as the 50% main level at $ 57.11 will not be supported.
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