Brent traded higher yesterday and today, after hitting support near the 65.10 level. That said, since February 15th, the price structure has been suggesting a trendless range between 64.60 and 67.84 and thus, even if the price trades somewhat higher, as long as it remains within the aforementioned boundaries, we will hold a flat stance with regards to the near-term outlook.
Currently, Brent is heading towards the 66.85 barrier, which provided decent resistance from February 27th until March 1st. A break above that level may pave the way for the range’s upper bound, at around 67.84, but we prefer to wait for a move above 67.84 before we start leaning towards the bullish side. Such a break would confirm a forthcoming higher high on both the 4-hour and daily charts and may signal the upside exit out of the recent sideways path. We may then experience extensions towards the 69.15 zone, the break of which could set the stage for the psychological round figure of 70.00.
Shifting our gaze to the short-term momentum studies, we see that the RSI runs above 50 and points up, while the MACD lies above both its zero and trigger lines, pointing north as well. These indicators detect upside speed and support the case for some further advances, at least towards the range’s upper end. Nonetheless, we repeat that we would like to see a decisive recovery above that bound before we get confident on larger advances.
On the downside, a dip below the 64.60 zone, which is the lower boundary of the range, may shift the near-term bias to a negative one. This could encourage the bears to shoot for the low of February 14th, at around 63.20, which if broken may extend the slide towards the 62.20 area, defined by the inside swing high of February 8th.
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