After some boring few months on oil we had finally some news that changed things here. Let’s have a closer look at oil.
Deal is done
And it was a matter of time. We saw a stagnation on oil because there was no deal in OPEC in terms of decreasing daily production. Now, the deal is done, production is lowered. Of course it impacted oil prices.
On chart below you can see that there was a resistance at 52.83$ but now – after breakout – we can expect that bulls will take that opportunity, below daily chart:
I’ve read some comments that oil will stop at 55$. I’m not so sure about that when we check monthly pivot points. Right now oil is near 55$ which is monthly R1 line. Below – daily chart with monthly pivot lines:
The way I see it, bulls got their momentum. If they manage to brake above R1 then we will be looking at R2 as next stop and R2 is at 58$. On the other hand, it is almost end of the year so it is possible that this movement will stop down a little or there will be some correction move here.
If we put Fibonacci on chart then we can see that the first possible level is 127% extension (marked on chart with… that color 😉 ):
Next we have 138.2 and 161.8 extension lines but for now 127 is in the game and this is almost right at 60$.
In my opinion it is a possible target for bulls – we will see if they can reach that level.