The price of Oil has tried to correct but the bulls found strong opposition and the price continues to decline in the face of ongoing concern over global growth amid trade conflicts, which remains the top concern of investors. Despite a near 11-million-barrel drawdown in crude inventories, the downside in the price of oil came in the wake of reports that Saudi Arabia had met with Kuwaiti officials and had discussed ramping up oil production in the southern neutral zone. This, coupled with poor global PMIs and a very bearish outlook for the Eurozone from the ECB President Draghi, makes next week's meeting between China and the US all the more critical for oil prices going forward.
Crude oil prices are still in sellers territory despite the minor recovery this morning as the break to the downside is postponed by the lower band of the flag presented on the chart. The price is currently trading below the $56.5 level with the momentum still in the neutral to negative zone. We will be focusing on the lower band first and then we will be watching the $55.06 level for the coming sessions.
Support: 55.73 / 55.06
Resistance: 56.69/ 57.4