Crude oil inventories data pushed the Brent oil price down
Brent crude oil behaves as we predicted. After an unsuccessful attempt to gain a foothold above the upper boundary of the price range, the price showed downward correction.
The Brent oil has shown a sharp decline on a back of the increase in US crude oil inventories. The oil reserves 3 times exceeded the forecasts. The crude oil inventories rose by 9.357 million barrels against the forecast of 3.090 million. This was the main factor in the fall.
We assume that the correction of the Brent crude oil prices will continue for another few days. We do not exclude that the price will try to fall below $39 per barrel. However, achieving this price level will be considered by investors as a good chance to resume buying.
Most investors tend to believe that the price of the oil has already passed its bottom. New attempts of the price to descend are the good chances to enter the market.
How to trade
Today, the price will continue to respond to yesterday's data on the oil reserves, so we would buy PUT options from the current levels.
Asset: Brent oil
Target price: 40.34
Close price: 39.77
Expiry time: 21:00 GMT