Oil’s been able to correct

Oil prices reached stability on Monday morning. Over recent days, Brent moved up to 63.50 USD, which is pretty good after hitting the low at 59.45 USD.

On one hand, Brent is taking advantage of the USD weakness, which got under pressure after the USA reported on their labor market numbers for May. Additional negative influence was forced by anticipation of a possible benchmark rate cut by the US Federal Reserve later this year.

On the other hand, the latest reports of the Crude Oil Inventories and the Natural Gas Storage along with the oncoming OPEC+ meeting help bulls stay up and wait for the news.

Brent has good chances to continue its rebound as long as the USD is weak and there is no too much news.

Technical forecast

As we can see in the H4 chart, after finishing another descending wave, Brent is trading upwards. It has formed an upside continuation pattern at 63.30, which is the level where the descending channel was broken. In fact, right now the pair may move towards 65.65 and then start a new correction to return to 63.30. Later, the market may form one more ascending structure with the first target at 66.33. From the technical point of view, this scenario is confirmed by Stochastic Oscillator, as its signal line is moving away from the “oversold area”, thus indicating a new rising wave.

In the H1 chart, after being corrected towards 61.00, Brent is forming the second impulse with the target at 65.63. Right now, the instrument is consolidating around 63.30 and has already expanded it both downwards and upwards. Possibly, today the pair may test 63.30 from above one more time and then resume trading inside the uptrend with the short-term target at 65.65. From the technical point of view, this scenario is confirmed by MACD Oscillator, as its signal line is moving above 0 inside the bar chart. Such technical signal is getting stronger with appearance of a divergence.