Brent just below major trend line resistance

$55/barrel should be followed closely this week as Brent prices are currently in a technically strategic zone for swing traders. Even though oil prices are likely to remain suppressed while the global economy adjusts (new equilibrium in supply and demand), I have the sense that those who call for $20/barrel in the WTI market are too aggressive and are likely exaggerating additional downside prospects. Therefore, I really would not be surprised to see oil prices rise further if concerns over the global economy's health wane into the end of the year.

Such a change in market psychology would be supportive of a continuation in the recent rise in oil prices following a technical signal above $55. That said, let's not get ahead of ourselves. So long as prices are below $55, the market is still in a clear downtrend and may very well turn lower with a fall back below $50 by the end of this week.