Good morning Traders!
Over the weekend OPEC+ has announced a production cut of over one million barrels a day from May up until December. That saw the price of Crude Oil and Brent Oil opening on Monday with a gap up.
Crude Oil has been in a sideways pattern since December 2022, the recent break to a Daily and a Weekly Lower Low was met with strong buying pressure that managed to push the price back to the middle of the consolidation area. OPEC+ announcement on the weekend, saw the market trading closer to the upper level of the consolidation around the level of 83.
As the market is still trading in it’s consolidation area, to consider a long setup, I’ll be looking for either strong compression of price underneath the 83 for a potential break higher, or a break with a decisive close above the level followed by a retrace.
However, as the market moved higher fast, the first breaking attempt could have a high likelihood of failing, and therefor may potentially offer a quick counter trend move, in the form of a break and reject.
Happy Trading!
