Crude oil prices snapped higher after suffering shocking losses and setting a record low just over two weeks ago, clearing resistance guiding them downward since the beginning of the year, DailyFX reported. Support-turned-resistance in the 27.40-29.11 area is now in focus, with a daily close above that seemingly setting the stage for a retest of 42.40, the underside of the December 2018 bottom.
Pushing through rising trend line support underpinning the recent recovery seems like a prerequisite for rekindling the move lower. This is immediately followed by a downside barrier clustered near the $20/bbl figure as well as the recently broken trend resistance, now recast as support. In practice, this probably means that a breach below swing low support at 10.27 is needed enthuse sellers in earnest.
Zooming out to the monthly chart for a broader perspective seems to suggest the path of least resistance continues to point downward. The eye-watering collapse in March saw prices crash through support that had underpinned them since the 2008 global financial crisis. Recent gains appear corrective in that context, at least for now. A breach of structural resistance – now just below $70/bbl – seems needed to say otherwise.
