Brent’s sharp rally on Tuesday, though a welcome news, needs to gain credence via another bullish daily closing preferably above the rising trend line hurdle (blue), in which case it would suggest bearish invalidation and that a short-term bottom is in place at $45.88/barrel.
A bullish daily closing today above rising trend line (blue) could yield a test of supply around $50.50 (sideways channel hurdle).
On the other hand, a failure to sustain above $48.34 (50% of May 2015 high – Jan 2016 low) on Tuesday if followed by a similar action in Europe today would open doors for a slide to $47.03 (5-DMA) - $46.75 (23.6% of 27.08-52.83).
A bullish daily closing today above rising trend line (blue) could yield a test of supply around $50.50 (sideways channel hurdle).
On the other hand, a failure to sustain above $48.34 (50% of May 2015 high – Jan 2016 low) on Tuesday if followed by a similar action in Europe today would open doors for a slide to $47.03 (5-DMA) - $46.75 (23.6% of 27.08-52.83).
