Brent: in anticipation of FOMC minutes _17.08.2016

Trading recommendations

Sell ​​Stop 48.20. Stop-Loss 48.75. Take-Profit 47.40, 46.20, 45.65, 43.65, 41.70, 41.00

Buy Stop 49.40. Stop-Loss 48.60. Take-Profit 50.00, 50.70, 51.00


Technical analysis

After the beginning of August the price of Brent crude rebounded from the support level 41.70 (38.2% Fibonacci correction level to decrease at the level of 65.30 to lows near the 2016 mark of 27.05) and broke through key resistance levels are 45.65 (EMA200 on the daily chart) , 46.20 (Fibonacci level of 50.0%), the upward momentum is weakening.

Despite the fact that indicators OsMA and Stochastic on the daily and weekly charts are on the side of buyers, on 4-hour chart, the indicator turns on short positions.

Support levels are 46.20, 45.65 remains the key. In the event of breakdown of the price will return to the downward trend that began in June, and into the descending channel on the daily chart with the lower boundary, passing near the level of 41.00 and just below the support level 41.70 (38.2% Fibonacci level).

However, positive expectations regarding the successful outcome of the OPEC meeting (26 - 28 September) still support oil prices. If the Fed's minutes of which are published today, will not be unambiguous signals on the possibility of increasing rates in the US in the coming months, as US crude stocks decline or do not grow in the past week (the forecast - a reduction of reserves at 0.333 million barrels), the price of oil can continue to grow in the direction of the July, marks the May highs near 50.00, 50.70 (Fibonacci level of 61.8%).

In any case, it is desirable to continue the purchases to wait for a turn indicator OsMA and Stochastic on the 4-hour chart on long positions.

 Support levels: 48.10, 47.40, 46.20, 45.65, 43.65, 41.70, 41.00

Resistance levels: 50.00, 50.70


Overview and Dynamics

Once reached local highs yesterday near the mark of 49.30 at today's oil prices are down moderately.

 Signs that Iran probably will not participate in the September talks, OPEC (26 - 28 September) indicate that the meeting in Algeria could end up without any action to stabilize the oil market.

On Tuesday, a spokesman for the Iranian Oil Ministry said that Iran has not yet decided to participate in the September meeting of OPEC.

Optimism regarding the achievement of the major oil-producing countries to freeze production agreement can also quickly melt away as he came after earlier statements by the Minister of Energy of Saudi Arabia and the optimistic forecasts of the International Energy Agency (IEA) on the possibility of reducing the excessive world oil reserves as a result of high demand.

Minister of Petroleum of Nigeria, which is also a member of OPEC, said Monday that the probability of reaching an agreement in September low.

Support for oil prices is also having a weakening US dollar on weak expectations about imminent rate hikes in the United States. According to CME Group, futures on interest rates account for 18% probability of a rate hike in September and 51% probability of the Fed tightening policy in December.

Conflicting data and statements of representatives of major oil producing countries continue to shake the oil market. Since the beginning of August the price of Brent crude rose by about $ 7 per barrel, rebounding from the support level near the mark of 41.70.

Prices on Tuesday rose to a new monthly high on news that Russia is planning a meeting with the members of OPEC in October. News strengthened the hope that the major oil producers agreed to limit production.

 The participants of the oil market are waiting for the weekly data on stocks of petroleum and petroleum products in the US, which will be released today at 14:30 (GMT). In recent weeks, the cumulative US crude stocks and petroleum products grew, and their further increase can put pressure on prices.

Also, the attention of the financial markets will be focused today for publication at 18:00 minutes of the Fed meeting, held on July 26-27.

If the protocols will contain signals the possibility of a rate hike in September, the dollar strengthened sharply on the currency market. Commodity prices then, including oil, can purchase a downward trend.