What to expect on oil after a daily decline that hasn’t been seen since spring 2020?
With a daily decline of 12.66%, November 26, 2021 will long be remembered as one of the black days of oil. There is little to say about the reasons for this decline as they are clear to everyone. Oil prices and international stock markets fell on Friday amid concerns that the new Omicron Covid-19 variant discovered in South Africa could dampen economic growth and affect fuel demand.
This decline, however, does not come unexpectedly for the readers of our reports. Starting from the principle that the graphs say everything, just listen to them, at the beginning of November we published a report entitled Full of lighter fuel in view of the Christmas holidays?
The collapse of oil prices, therefore, is now explained with the appearance of the Omicron variant, but in reality it comes from afar.
What to expect on oil after a daily decline that hasn’t been seen since spring 2020? The indications of the graphic analysis
The Petroleum (price in real time) closed the session on November 26 at 68.15 dollars, down by 12.66% compared to the previous session. The week ended with a drop of 10.26% compared to the previous weekly close.
Daily time frame
The current trend is bearish and with the breaking of the strong support in the 70.66 dollar area it has opened the doors to the achievement of the III price target in the 63.38 dollar area. At this price level, buyers should make their presence felt again by pushing prices higher.
More immediately, a return to the upside could materialize with a daily close above $ 70.66.
Weekly time frame
The close on November 26th gave a bad blow to the hopes of the bulls who saw the $ 70.17 area (I price target) as a possible restart point. With the breaking of this level, in fact, the doors were opened to reach the II price target in the area of 54.93 dollars. The maximum extent of the decline then passes through the $ 39.69 area (price target III). At these levels, we should see a resumption of the upside.
In the short term, the bulls could regain control of the trend in the event of a weekly close above $ 70.17.
(We remind you to carefully read the warnings regarding this article, which can be consulted WHO”)