Crude Oil Brent rebounded upward

Introduction.

If you are one of the investors who are interested in technical analysis in their investments in the financial markets, then you are of course looking for the trend. You are looking for the direction of your stock, whether it is an upward trend, a downward trend, or a sideways trend.

Of course, you do not find it easier than drawing the trend line for the stock, and you are also looking for the technical patterns that are formed on the chart, as it is considered one of the technical means that qualifies you to make the appropriate decision at the appropriate time, whether the decision is to buy or sell.

Technical Analysis of the Crude Oil Brent

Head and Shoulders Pattern

Here let me give you an example Through the attached drawing of Brent crude oil to see what signals are formed on this indicator or this stock. You will see in the recent past that it may have formed a head and shoulders pattern, which is a famous technical pattern that is clearly formed, and you will see that the stock gave an exit signal once it broke the $84 level downwards, and the downward target resulting from the formation of this pattern and confirmation of the break of the confirmation line, which is the neckline of the pattern, was around $72. This confirms to you that technical patterns are considered important tools in decision-making through your use of traditional technical analysis.

As we know falling targets or rising targets may only hinder the stock from reaching these targets, strong support or strong resistance, and in our case, the Brent crude stock, it is clear on the drawing that the current support area is a broad support area starting at the $77 level down to the $73 level.

Since the Brent crude stock had achieved a decline from the level of $84 in the direction of reaching the bearish target mentioned above, it stopped slightly at the broad support level, where it reached the level of 72.5 $, and rebounded from it upwards as a logical and natural reaction when it touched a broad support area.

From the above, it is clear to us that the Brent Crude Oil stock has reached the downward target formed in a head and shoulders pattern, and here the role of the formed technical pattern ends and another technical analysis tool comes into play, which is the trend line.

Crude Oil Brent's current direction.

On the drawing attached above, it is clear to us that the Brent crude stock is moving in a downward direction, which is indicated by the downward red line and is also moving inside a downward price channel, indicated by the two blue lines.

Since the upper limit of the downward price channel represents resistance moving downward in front of the stock now, the first resistance is Strong in front of the stock is the upper limit of the descending price channel at the level of $81.6, and if this level is breached upward, the Brent Crude Oil stock will have another downward moving resistance, which is the main descending trend line currently at approximately the level of $85.

In addition to what was mentioned above, we can add the levels of resistance, support, and stop loss that are currently in front of the Brent crude stock. Let us start with the support levels. The first support level is $77.13, the second support level is $73.62, the third support level is $71.86, and the stop loss level is $70. Resistance levels start with the first resistance level, which is a downward-moving resistance level that starts at $81, the second resistance level is horizontal, fixed at $83, then a third resistance level at $85.

Note:

This article is translated from my Arabic Blog (Adel Onsi Mohamed's Blog).