The price of Brent crude jumped on Monday morning after the escalation in the Middle East (Israel attacked Iranian energy infrastructure and Iran responded with a wave of attacks on Israel), but the gains were short-lived, as the price fell after Iran announced the end of the attacks, which calmed the markets.
In addition, OPEC+ agreed to a fourth increase in oil production to stabilize oil markets, which increased pressure on prices.
Brent crude oil price fell 4.5% on Thursday and Friday with the strong decline contained by the daily Ichimoku cloud base ($93.14) which continues to provide strong support (a probe under the cloud base on May 28/June 1 triggered a false breakout).
Daily studies remain mostly bearish and contribute (in addition to weakening fundamentals) to the scenario of a renewed attack on the cloud base, the strong breakout of which would generate a new bearish signal and open the way towards the $90 area (psychological/low of May 29/100DMA).
The near-term bias is expected to remain with the bears while the price remains below the big barrier at $98.63 (Fibo 38.2% of $112.70/$89.93) which has so far capped two attempts and is guarding another important resistance at $100 (psychological).
Beware of possible recurrent cloud base failure that may sustain near-term movement in extended lateral mode.
Accuracy: 97.41; 98.63; 99.70; 100.00
SOP: 93.14; 91.76; 90.81; 89.93
