Brent Crude Opens with a Bearish Gap
As shown on the XBR/USD chart, Brent crude oil opened this Monday morning around $59.00, forming a bearish gap relative to Fridays closing price of approximately $61.40.
The current Brent crude oil price is near the yearly low reached about a month ago, following the announcement of Trumps tariffs, which turned out to be significantly higher than expected.
Why Is Oil Falling?
As we noted on 30 April, market participants are closely watching news related to OPEC+. Over the weekend, during an online meeting (according to media reports), the following developments occurred:
It was stated that the current oil market is fundamentally healthy;
A decision was made to accelerate the pace of oil production increases.
According to the plan, output will rise by 411,000 barrels per day with some believing this move is partly due to certain OPEC+ countries previously failing to adhere to production quotas.
Technical Analysis of the XBR/USD Chart
Oil price movements in 2025 form a descending channel (shown in red), with progressively lower highs and lows indicating bearish sentiment.
Although bulls may hope that the lower boundary of the channel could act as support, bears are showing signs of dominance (as indicated by arrows):
the median line of the channel previously acted as resistance;
now, similar behaviour is seen at line Q, which divides the lower half of the channel into two quarters;
the Rounding Top pattern also signals strong selling pressure.
Fundamentally, oil prices are supported by Chinas willingness to negotiate tariffs with the US. However, considering the OPEC+ decision and ongoing fears of a global recession, the current downward channel on the Brent crude oil price chart is unlikely to lose relevance any time soon.
Read more: https://fxopen.com/blog/en/oa-brent-crude-opens-with-a-bearish-gap/
Text source: Forex Trading Blog
