After serious support at $ 71 was broken through, the price of Brent quickly reached the last bastion of bulls — a 3-year uptrend, which began at levels below $ 30. Yesterday’s minimum of $ 61.7 almost perfectly matched it. Therefore, today’s rebound should not be surprising, we would rather be surprised if such a serious trend were immediately broken down. It is much more important whether oil can form a reversal pattern on a larger scale (hourly or daily), while remaining within the weekly uptrend.
If it works out, then everything can end for bulls with a slight fright. Moreover, not only for oil bulls, as the dynamics of oil directly affects the general sentiment in relation to risky assets, including the stock market. If today’s rebound from the weekly trend turns out to be a “dead cat rebound” and Brent price rewrites yesterday’s low, this may be a sign that more serious problems are expected ahead of investors in risky assets than what we see from the beginning of October.