Oil Technical Update
Brent Crude Oil 9/28/2012 4H Chart 8:55AM EDT
ABC Pullback: The previous update on Brent crude noted a pullback in progress and suggested further upside risk back to the previous range. Another corrective leg did develop, and brent is not trading around 112.50 as we get into the 9/28 US trading session. The pullback has achieved 50% retracement of the 117.92 to 107.09 swing. This also completes an ABC correction where C=A.
The bearish outlook following the current pullback is still in play. However, the momentum isn’t very clear as the 4H RSI reading pushes above 60. Also, if price pushes above 113.80, 61.8% retracement, the rally looks like it can extend further, and the case for bearish continuation weakens. Instead ,we would be looking at a bullish to sideways market, with focus back to the 117.90 area.
The bearish outlook has a swing projection from the current high toward 102.50-60 area. Looking at the daily chart, we see the 50% retracement of 88.88-117.92 rally at 102.40. Downside expectation should probably be limited to a support/resistance pivot at 102.05. Below that another key support will be the 100.00 handle, which is right there with the 61.8% retracement.
Brent Crude Oil 9/28/2012 4H Chart 9:05AM EDT
Fan Yang CMT is the Chief Technical Strategist, trader, educator and a of the main contributors to FXTimes – provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.
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