Crude oil prices got a lift on Monday, as a weaker US Dollar allowed Brent crude to rebound strongly. The Brent crude benchmark rose strongly by more than 5% after traders opted for risky appetite, following the biggest weekly loss in more than nine months. Last week, Brent crude oil fell by 8% as the Fed’s decision to start tapering in late 2021 sent the US Dollar soaring.
Apart from the day’s rebound, which is more of a rally in a downtrend on the near-term charts, sentiment on crude oil remains weak as the overall fundamentals have not changed.
The recovery in crude oil price has breached the 67.74 resistance but stopped short of the 70.01 resistance mark due to a stall on the descending trendline resistance. If the price can overcome this level, 70.01 becomes available. There is also a chance of 71.44 and 73.34 becoming relevant if there is an additional advance on the asset.
Otherwise, rejection at the descending trendline resistance allows for a resumption of the downtrend, targeting 67.74 and 66.81 along the way. A further decline makes 65.95 and 64.64 potentially available, with a breakdown of the latter creating an opportunity to retest 4-month lows at 62.33.