In my previous analysis here I highlighted the bearish flag pattern and we reached our profit target of $44 recently. Price has now reached and rebounded on the support level at $42.21 and its time for fresh analysis.
The dramatic fall over the last few days was expected with the OPEC situation still unclear. The market is waiting for any signs of a deal to regulate production and supply and until we have this information I predict Oil to fall further.
The next buying opportunity lies down at $41. I predict price will continue to fall in the coming days until we reach this buying zone. When price does reach we are likely to consolidate before retracing.
With an entry between $41 and $42 and stop below the buying area at $39.10 we have the potential to see Oil make a significant come back on which we can profit.
With regards to profit targets, a profit target at support turned resistance around $43.60 seems the smart option. Special attention should be paid to any fundamental information that hits the market as any positive OPEC news should see Oil rally significantly.
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