Technical Analysis: Brent oil bounces off 100-SMA inside short-term falling triangle
Although coronavirus (COVID-19) strains probe the commodities off-late, Brent oil’s latest U-turn from 100-SMA favors the energy bulls. Also keeping the oil buyers hopeful is a short-term descending triangle formation on the four-hour chart. However, a falling trend line from last Wednesday around $55.70 can offer immediate resistance to the quote ahead of highlighting the triangle’s upper line. It should be noted that the commodity’s ability to defy the triangle with an upside break of $56.25 will not only challenge the monthly high of $57.37 but will also raise challenges for the $60.00 threshold and February top near $60.25.
In a case, Brent oil drops below 100-SMA, at $54.70 now, triangle support of $54.40 and an ascending trend line from December 23, currently around $53.50, will add filters to the downside momentum. However, the oil bears’ reluctance to respect the $53.50 support will be tested by the $53.00 round-figure before highlighting the monthly low close to $50.00.