The strong rally in Brent Crude in July put bears on a cautious footing. However, a decisive reversal at Fibonacci resistance has kept the medium term bear outlook intact.
- BRENT WEEKLY CHART -CONTINUATION Earlier support around a 38.2% pullback level has now been breached. This provides a boost to medium term bears. The next important support area starts at the longer term 38.2% pullback (of whole 2009/2011 recovery) at 92.32 and includes the shorter term 90.64 61.8% level and 89.58 May-10 high.
- BRENT DAILY CHART –Oct-11: The Jul recovery found clear resistance from the 76.4% retracement near 120.00, keeping bears in favour. Sharp reversal pierced the 103.02 27-Jun low and has found temporary support from the channel base projection that we highlighted in the Commodity Specialist Guide. Rallies should be corrective only at this stage and we have marked in lower Fibo projections, the 1.618 swing off prior 103.02/120.00 bounce, at 92.50, and a lower projection at 89.80. These tie in nicely with the Weekly chart support area.
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