The Organization of Petroleum Exporting Countries will meet in Vienna Today to review their output strategy. Most analysts expect OPEC to keep production rates unchanged, which suggests high oil prices?!!

I think things are a bit different, I expect the meeting will focus on setting oil prices for the next period, and OPEC will take the appropriate decision to contain oil prices within the range that OPEC saw it appropriate for the next period…

Anyway; let’s take a quick look at weekly chart and try to combine technical analysis with OPEC meeting today ?!!!

Will Oil Rally LastAs you see on the weekly chart posted above, the pair has reached a critical resistance level around 50.00 , there’s a high potential for a strong reversal for 2 reasons:

1- We have a static resistance at the 49.86 levels (Close of the week Oct 04 2015)…

2- We have a Fibonacci retracement 61.8% at 49.68 of the big run (27.70/63.27)…

The pair is likely to pullback from this level but first, let take a look at support and resistance levels:

The next support levels are :

3- Low of the week Oct 04 2015 at 45.44 levels which are so close from Fibonacci retracement 50.0% at 45.48 of the big run 27.70/62.27….

4- Next support comes at the 41.15 levels( low of the week Nov 08 2015) which are so close from Fibonacci 38.2% retracement at 41.29 of the same run 27.70/62.27….

What would happen next ???

I think the outcome of OPEC meeting today will result in keeping oil prices within 45.00/50.00 range …

On the upside, in the case of a breakout above 50.00 levels which I think is unlikely but not impossible, If seen, the WTI Oil will target the 55.59/59.82 levels…

On the downside, a failure to take out the 50.00 levels could mean a return to the 45.45 levels before the next rise, below 45.45 will extend the pullback towards the 41.30 levels before the next up….

Conclusion: The pair remains up, but it trades around critical resistance which suggests a possible pullback. (expected range  : 45.00/50.00)…

 

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