Brent Technical Analysis: Failed breakout has exposed 5-day MA support
|- Monday's candle is signaling buyer exhaustion and scope for correction.
- A pullback to the 5-day average support looks likely.
Brent oil has likely created a temporary top and could suffer a deeper pullback to a short-term moving average support.
The black gold on Monday clocked a high of $70.72 but failed to close above the Sept. 16 high of $69.64 and ended on a negative note at $68.41, essentially carving out a candle with a long upper shadow – a sign of buyer exhaustion.
Monday's drop also confirmed a bearish divergence of the relative strength index and the MACD histogram.
All-in-all, brent oil could correct or drop to the ascending 5-day moving average support, currently at $67.56. The case for a drop to $67.56 would weaken on an hourly close above $67.46.
Daily chart
Trend: Correction likely
Technical levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.