With recent oil sell off after Iran sanctions threatened the global supply, OPEC took steps to deal with output shortage from Iran. A sell off took the oil price back to the confirmed daily trend line and closed right on it on Friday. This is also a 50% retracement level of the move. A break below would suggest a potential reversal of the trend, though as break below 65 would be better confirmation, or even the 61.8% fib retracement. Depends on your trading style.
On the other hand, this could be a good opportunity to buy from the pullback, risk-reward is very good it this point. Oil is highly dependant on fundametal news, so keep an eye on it.
Happy Trading!
On the other hand, this could be a good opportunity to buy from the pullback, risk-reward is very good it this point. Oil is highly dependant on fundametal news, so keep an eye on it.
Happy Trading!
Comment:
Trump's announcement for OPEC to increase production by a million bpd to keep prices from rising 'artificially high' come after huge losses for US shale oil investors, over $16 billion. US needs lower oil prices. So far no response from OPEC. You can find the article on bloomberg.
A break below the 64.20 would signal a continuation of the move but be wary of the 61.8% retracement, which is just below it. Tomorrow's G7 summit could have big consequences for market action, check the news for updates.