Oil prices are looking interesting following the response to the FOMC and the earlier softness in US inflation. Essentially the charts are telling us a near term high backed by the idea of a longer tight monetary policy environment for the US. That said we are entering the US driving season when seasonal cycles dictate pricier fuels as people head off to trips for the summer.
Resistance
- 84.18/25 – 50D Moving Average / May Range Play Resistance
- 83.56 – Intraday Consolidation Resistance
- 83.09 – Yesterdays High
Support
- 81.78 – Intraday Double Top Trigger
- 81.34 – 20D Moving Average
- 80.72 – May Range Play Lows
Brent Crude has an inverted hammer in the daily charts and a double top when moving intraday, suggesting a near term top may have been reached. For indicators we have an overbought daily stochastic with a bearish cross poised to come off 80. Intraday we have a bearish divergence in the 4H picture. For now we are waiting for the hourly double top to get triggered with a strong break of 81.75 immediate objective would be easing off to the May Range Play Lows. From there we will look for some form of consolidation long hourly tails or bullish engulfing to underscore the overall bullish tone due to cyclical factors.
