Oil Awaits Its Next Big Move

By Tomasz Wisniewski|

Published: November 29 2023, 06:28 GMT+0

Oil Awaits Its Next Big Move

In today’s technical spotlight, we turn our attention to Brent oil, a commodity that’s been in a holding pattern of late, but appears poised for a significant move. The current market scenario suggests an impending breakout, given the formation patterns observed.

The price of oil is currently navigating through a pennant formation, delineated by two converging red lines. This pattern, often indicative of a period of consolidation before a substantial price move, is nearing its culmination. Additionally, this pennant also resembles an inverse head and shoulders pattern, with the upper boundary of the pennant acting as the neckline.

What’s critical now is the direction of the breakout. Should today’s trading see a close above the upper red line of the pennant, it would activate a bullish scenario. This buy signal would set the stage for an ascent towards the $88 resistance level, represented on the chart by a green line.

Conversely, a downward breach of the pennant’s lower boundary would flip the script, signaling a bearish turn. In this case, a sell signal would be initiated, with the price potentially plummeting towards the $71 per barrel mark, highlighted by the orange line.

As the markets teeter on the edge of this technical decision point, traders and analysts alike will be watching closely. The direction of the breakout could set the tone for oil’s market trajectory in the near term.

Source: https://www.axiory.com/analytics/technical-analysis/oil-awaits-its-next-big-move