Brent crude is recovering and the short-term trend is bullish, but watch out for seasonal weakness says David Linton, Chief Executive at Updata.
Linton points out that Brent has pierced through the cloud on ichimoku charts and is now in a bullish phase. Its correlation with the USD is negative (as is usually the case) and the fall in USD is bringing oil strength.
However, Linton says crude is entering territory where seasonal strength starts to fall off and price comes under pressure, such that the second half of the year is normally the bad half.
For the moment, however, Brent is bullish above the cloud at $40.50, with $44.40 and $45.50 his upside targets.
For details, watch Updata’s Technical Analysis for Energy Traders, which includes an analysis of the major energy, currency and stock markets:
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