The price of Brent crude oil has been declining from month highs at $54 per barrel for three weeks already, being pushed down by the excess of supply over demand.
Crude Oil Stocks change for the last week of October is due on Wednesday in the US. The previous report indicated a growth to 8.028 million barrels, which was more than 4 million barrels above the forecast.
Given the global economic slowdown and growing volumes of oil production and export, the price of oil tends to remain under pressure in the medium term.
Support and resistance
The price returned to September lows at the level of 47.00. This level is also the lower border of the range 54.00-47.00, within which the price has mainly been trading during last three months.
OsMA and indicators on the daily and 4-hour charts recommend short positions.
If tomorrow statistics indicate a decline in US crude oil stocks, an upward correction may start, but the price is unlikely to overcome the levels of 49.00 (EMA144, EMA200 on the 4-hour chart), 49.70 (EMA50 on the ).
Support levels: 47.00, 45.25, 42.50.
Resistance levels: 49.00, 49.70, 50.00, 50.50, 51.00.
Short positions can be opened at the current level with targets at 46.60, 46.00, 45.25 and stop-loss at 47.60.
Pending Buy Stop orders can be placed at the level of 47.80 with targets at 48.20, 49.00, 49.40, 50.00, 51.00, 51.50, 52.00 and stop-loss at 47.40.