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Oil is below 68$. A correction or a trend reversal?

Olymp Trade

Brent price broke $70.0 and continues to decline impulsively. Over the past 24 hours, the asset has decreased in value by 5.9% or $4.2 and the current local minimum is $67.5 per barrel. The long-term trend line is broken, so there is a full correction. The Fibonacci retracement level (61.8%) near $66.0 can become a correction target, while the current range of $66.6-68.0 will most likely become a zone of strong buyers. If the fundamental factors are be positive for oil, the price is expected to return to $70.0 in the middle term.

Impulsive drop of quotes began on Wednesday when EIA released data on crude oil inventories. They increased by 4.74 million barrels, up to 2-year highs. Gasoline inventories increased by 3.716 million barrels and distillates were up by 768 thousand barrels. Experts believe that gasoline and distillates stocks increased due to weak demand from refineries. According to the US Department of Energy, the US refinery utilization fell by 0.6% to 89.9%, which is the lowest result since 2014.

Geopolitical factors could not have any deterrent effect on today's sale. The growing tension in the Middle East, the escalation of the trade war between the USA and China, and even the recent statements made by OPEC about likely continuation of the production decline did not affect the market.

Source: https://olymptrade.com/
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