Brent Crude Oil Price Update – Holding $52.95 Pivot Could Trigger Breakout Over $55.58 with $57.11 First Target

International-benchmark Brent crude oil futures closed higher on Friday, but still managed to lose ground for a third straight week. The market fell to its lowest level in move that 18 months last week and is down more than 20 percent for the year. Continuing to pressure the market is rising supply and worries that a global economic slowdown will put a dent in future demand.

On Friday, March Brent crude oil settled at $53.21, up $0.48 or +0.90%.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, however, the closing price reversal bottom on December 26 has slowed the downside momentum.

A trade through $55.58 will confirm the closing price reversal bottom. This won’t change the main trend, but it could lead to a 2 to 3 day counter-trend rally.

A move through $50.31 will negate the closing price reversal bottom and signal a resumption of the downtrend.

The short-term range is $50.31 to $55.58. Its 50% level or pivot at $52.95 is controlling the near-term direction of the market.

The main range is $63.91 to $50.31. Its retracement zone at $57.11 to $58.71 is the primary upside target.

Daily Swing Chart Technical Analysis

Based on Friday’s price action and the close at $53.21, the direction of the March Brent crude oil market on Monday is likely to be determined by trader reaction to the pivot at $52.95.

Bullish Scenario

A sustained move over $52.95 will indicate the presence of buyers. If this move is able to generate enough upside momentum then look for buyers to make a run at $55.58. Taking out this level will confirm the closing price reversal top. This should trigger a rally into the short-term retracement zone at $57.11 to $58.71. Since the main trend is down, sellers are likely to come in on a test of this area.

Bearish Scenario

A sustained move under $52.95 will signal the presence of sellers. If the selling volume increases on the move then look for a potential acceleration to the downside with last week’s low at $50.31 the next target.

Taking out $50.31 will signal a resumption of the downtrend with the June 21, 2017 bottom at $49.16 the first target, followed closely by the April 18, 2016 main bottom at $48.86.