Brent oil sellers look for $68.00 retest

Escalating covid woes weigh on commodities while downbeat China data exerts additional pressure on the Brent oil prices during early Monday. Also favoring the oil sellers could be the quote’s U-turn from 50% Fibonacci retracement of early August upside, followed by a break of the one-week-old rising trend line. Hence, the Brent oil prices are all set for further weakness towards a horizontal area near $68.00, comprising lows marked in the last one month. However, oversold RSI conditions may challenge the bears afterward, if not then 61.8% Fibonacci Expansion (FE) of the current month’s drop and pullback around $67.15 will act as an extra filter to the south.

Meanwhile, corrective pullback needs to cross the support-turned-resistance line near $71.65, a break of which should direct oil buyers towards the 100-SMA level of $72.90 and then to the $73.00 round figure. In a case where the Brent bulls stay dominant past $73.00, $74.20 and the monthly peak surrounding $76.60 should return to the chart.