Oil prices rebounded in Asia on Monday, November 7, 2016 as investors turned attention toward U.S. politics on one hand, and awaiting for further clarity on OPEC efforts to curb output on the other hand.

NYMEX crude oil for delivery in December rose 0.91% to $44.47 a barrel.
In the week ahead, politics are supposed to overshadow market fundamentals, with most of the focus falling on Tuesday’s U.S. Presidential Election. At the weekend, the FBI officials announced that no criminal charges were warranted against Democrat Hillary Clinton for using a private email server aided to raise victory chances over Republican nominee Donald Trump in the election ahead.
Oil traders will also keep an eye on monthly reports from the IEA and the OPEC on Thursday and Friday this week respectively for fresh signals on supply and demand clues.
Crude Oil tumbled to multi-month lows on Friday last week and booked their biggest weekly loss in almost a year due to rising skepticism over the implementation of a planned deal by OPEC for a production freeze.
The possibility that major producers could walk away empty-handed from the November meeting looms after Iraq, Iran, Nigeria and Libya all signaled they might not participate in the proposed production cut deal.

But let’s have a look at Crude’s chart and some technical indicators to forecast future price action.

oil prices

As it is depicted in the chart, oil has been trading in a tight range above $ 44. The primary and very crucial supportive zone remains on Friday’s low at 43.50 where in case it is broken below, can accelerate the decline toward the low of August and April 3rd at $39.20 and $36 level respectively. On the flipside, breaching above $46.50 level can raise bullish sentiments in the market for further gains toward the high of $52.10 hit recently on October 19th, 2016.

While we have mentioned earlier on the post, dated on August 25th, an inverted head and shoulder pattern have been recognized on the weekly chart. Meaning that an upside move targeting around $70 per barrel is not something out of reach. It should not be forgotten that this pattern is triggered and considered valid as long as $39 level is held healthy and on the other hand, $52 per barrel is heavily broken up.
Contrarily, in case $39 level is breached, the Crude will extend losses towards $34.80 as the initial target and $25.90 level (the low from which price changed direction on February 11th, 2016) respectively, raising the odds of a fresh low in action around $19 per barrel.

But for now, the political factor, U.S Presidential Election and the consequences would have a significant impact on global markets as well as oil, and each of mentioned price levels can be hit according to winner of the contest.