Brent prices recently retreated after testing a long-term bearish trend line (only visible on log chart). Technicals currently favor a bearish bias below $42, which is a previous support level. Renewed selling pressure towards the quarter's close would expose $38 and $36 as short-term targets. A break above $42 would suggest a change in market dynamics, which would likely provide for further support for currencies like the Canadian dollar (see my related post below), Norwegian Krona, Russian ruble, etc. A sharp decline in the US dollar following next week's NFPs data would probably be needed to confirm a bullish dynamic for the start of the second quarter. Otherwise, it would be reasonable to maintain a bearish bias so long as price action below $42 supports that stance (absence of bullish candlestick reversal patterns).
