Brent Crude Oil futures remain range-bound near multi-year highs as traders keep the bid firm against a backdrop of possible conflict in the Persian Gulf. The rhetoric coming from Iran and troop movements by Western Powers continue to feed into the bullish technical outlook, with the chart analysis revealing a strong uptrend in this market. Autochartist is tracking price developments on multiple time frames, with the 240-minute interval capturing the major trend in the form of a Rising Channel chart pattern.

Brent Crude Oil has held a substantial premium over the United States WTI (West Texas Intermediate) Crude Oil futures contract in recent months, as the former seems to have become much more vulnerable to geopolitical tensions and also more susceptible to supply and demand fluctuations on the global oil market. As both contracts trend higher, Brent is far ahead in price terms and now rests comfortably above $120 per barrel. The swing high of the last move actually tested the $130 level before a modest pullback.

Despite the day-to-day volatility, the range for Brent is well contained by the support and resistance lines that for the Rising Channel chart pattern. The erratic spikes have diminished the internal readings of the pattern to a degree, but the Clarity ranking of 10 bars reflects the consistency with which the market has held this trend. It may continue to do so as fear premium builds to gradually drive the price upwards and further develop the channel.

The first sign of weakness- for potential short selling or establishing stop-loss areas on long positions- remains beneath the support provided by this Rising Channel. Currently that would mean a price decline to below the $120 per barrel level for the execution of a technical breakout to the downside. This would be a long term signal in the broader view of the uptrend, and call into question whether a top has been achieved.

Barring such a downside breakout, the likely path of least resistance will find buying interest at the bottom of the channel, with an eventual push to even higher highs to the rising resistance level. Autochartist will identify shorter term timeframes to trade moves within this relatively large trading range. A breakout above the top of the channel would be a strongly bullish development and put the market on track for a retest of the all-time highs set in 2008.

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