Brent technical analysis: Looks south after bearish outside day

Brent created a bearish outside day on Monday.
Prices risks falling to recent lows below $69.00.

Omkar Godbole FXStreet Contributor

Brent oil could retest and may possibly break below the recent low of $68.88, having charted a bearish outside day on Monday.

The black gold had jumped to a high of $72.56, having persistently defended the 50-day moving average (MA) last week. The bounce, however, was short-lived with the price falling all the way back to $69.70, possibly due to trade tensions and risk aversion.

The drop from $72.56 to $69.70 engulfed the price action seen on Friday. Essentially, the bounce from the stiff 50-day MA support ended up creating a bearish outside-day candle.

So a deeper drop could be in the offing in a day or two and the selling could gather pace below Monday’s low of $69.74. As of writing, oil is changing hands at $70.16 per barrel.

Daily chart

Trend: Bearish

1. R3 74.1
2. R2 73.1
3. R1 71.27
PP 70.27
1. S1 68.44
2. S2 67.44
3. S3 65.61

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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