Oil prices maintain a soft trend with prices hugging the rising trend line.
Price action suggests that the upside momentum is waning. Oil prices closed right near the major trend line on Friday.
We expect to see a possible bounce to the upside. But the gains might be limited near the price area around the 40.42 – 40.18 levels.
If we see a reversal near this level, then we expect oil prices to break the trend line. This might, in turn, put the downside focus towards the 34.41 level of support.
The bearish view might change only in the case that oil prices can manage to break out above the 40.42 – 40.18 levels convincingly.