Brent oil bears can reap 4.75% gains on $84.00 breakdown
A two-month-old support line break joins the failures to keep rebound from 20-DMA to favor Brent oil sellers. However, a clear downside break of the $84.00, comprising the immediate moving average support, becomes necessary. Following that, a fall towards $80.00 becomes imminent. Should the oil sellers keep reins past $80.00, the mid-September high near $76.40 will be in focus. Given the latest risk-off environment and the easing tension around energy shortage, oil is likely to consolidate the latest gains from the multi-month high.
Alternatively, fresh upside needs to regain beyond the previous support line, around $86.15 to aim for the latest high, also the highest since October 2018, near $86.70. It should be noted, however, a daily closing beyond $86.70 will challenge June 2012 low near $88.50. Given the RSI conditions near the overbought area, the upside momentum may witness intermediate pullback even after crossing the key hurdles to the multi-month highs.
Alternatively, fresh upside needs to regain beyond the previous support line, around $86.15 to aim for the latest high, also the highest since October 2018, near $86.70. It should be noted, however, a daily closing beyond $86.70 will challenge June 2012 low near $88.50. Given the RSI conditions near the overbought area, the upside momentum may witness intermediate pullback even after crossing the key hurdles to the multi-month highs.