KUALA LUMPUR: The Brent crude oil price may fall back towards US$59.50, signalling that the price could head south after peaking at US$64.65 before staging a pullback.
Maybank Investment Bank Bhd said the oil price had hit the earlier projected price at between US$63.30 and US$67.10 but is now showing signs of a bearish reversal pattern.
“Brent crude oil price eventually has peaked at US$64.65 before stated to stage a pullback. We saw a ‘Tweezer Top’ candlestick pattern which is a bearish reversal pattern. Stochastic too has staged a negative crossover.
“These have resulted in Brent crude oil retracing towards the 38.2 per cent of the Fibonacci Retracement level at US$61. We also noticed that the uptrend made a mild turn, which implies that Brent crude oil could head south.
“For now, we hold the view that Brent crude oil may fall back towards US$59.50. If this level fails to hold, the next support is at US$57,” said the research firm in a note today.
Meanwhile, Maybank IB said with overnight Wall Street ended broadly lower yesterday, the market would likely extend its losing streak today.
“Locally, there is hardly any catalyst to drive the benchmark higher. O&G stocks could come under pressure amid weaker oil prices.
“Technically, we expect FBMKLCI to trade between 1,718 and 1,730 today and downside supports have been revised to 1,713 and 1,700,” it added.