Brent oil - Watch out for bearish price-RSI divergence
Indication of major reversals on the charts usually come in the form of bullish/bearish price divergence with indicators (I prefer RSI).
As of now, Brent is trading around $47.80. Today's high stands at $48.07, while the latest cyclical high is $48.26.
Traders need to watch out for a "rise above $48.26, followed by a negative daily closing". Look at daily RSI. Despite price nearing cyclical high of $48.26, RSI is still sufficiently far away from its cyclical high.
In short we have a recipe ready for a bearish price RSI divergence when price is around critical resistance levels - $47.99 (23.6% of June 2014 high-Jan 2016 low),
If we get a confirmation of bearish price rsi divergence, prices could test the then "double top" neckline level of $43.30
As of now, Brent is trading around $47.80. Today's high stands at $48.07, while the latest cyclical high is $48.26.
Traders need to watch out for a "rise above $48.26, followed by a negative daily closing". Look at daily RSI. Despite price nearing cyclical high of $48.26, RSI is still sufficiently far away from its cyclical high.
In short we have a recipe ready for a bearish price RSI divergence when price is around critical resistance levels - $47.99 (23.6% of June 2014 high-Jan 2016 low),
If we get a confirmation of bearish price rsi divergence, prices could test the then "double top" neckline level of $43.30
