Today, during the Asian session, Brent Crude Oil prices show flat dynamics, consolidating near the $72 per barrel mark
Since the beginning of the week, the instrument has significantly decreased, updating the local lows of July 21. The reason was the alarming mood in the market regarding the next increase in the incidence of coronavirus in certain regions of the world, in particular, in the United States and China, which are the main consumers of petroleum products. In addition, investors still expect the return of Iranian oil to the market amid active negotiations between Iran and the United States on the nuclear program.
In turn, a small support for the quotes of "black gold" on Tuesday was provided by a published report from the American Petroleum Institute (API) on reserves. For the week of July 30, the indicator again decreased by 0.879 million barrels after a decrease of 4.728 million barrels for the last reporting period. On Wednesday, bidders expect the publication of final data on reserves from the US Department of Energy.
Support and resistance levels
On the daily chart, the Bollinger bands are uncertainly declining, leaning towards a reversal in the horizontal plane within the forex forecast. The price range practically does not change, but it remains quite spacious for the current level of activity in the market. The MACD indicator is declining, maintaining a strong sell signal (the histogram is located below the signal line). Stochastic shows similar dynamics, but it is rapidly approaching its minimum levels, indicating the risks of oversold instrument in the ultra-short term.
Resistance levels: 73.00, 74.00, 75.50, 76.91.
Support levels: 71.80, 71.00, 70.00, 69.00.
Trading Scenarios
Thus, the analysis and forecast of oil prices for August 5-6, 2021, short positions can be opened after the breakdown of the level of 71.80 down with the goal of 70.00. Stop loss — 72.30. Implementation period: 1-2 days.
Long positions can be opened after a rebound from the 71.80 level and a breakdown of the 73.00 level up with the goal of 75.50. Stop loss — 71.80.