The coronavirus contagion of the markets is back in full swing on Monday, battering crude oil price as risk-off sentiment goes through the roof. Simulations carried out by a team led by Eric Toner, a researcher and doctor at the John Hopkins Center for Health, have indicated that the Coronavirus had the potential to kill 65 million people in 18 months under the right conditions. The Coronavirus infection has now turned up in several countries, far beyond the recent quarantine borders put up by the Chinese government in Wuhan and other cities.
The risk-off mode has been set off in the global markets, as crude oil prices, especially those of the Brent variant, have taken a massive plunge since Friday, taking out the downside price targets identified in my previous analysis.
Brent crude has crashed through the 62.6 support level and is now testing the 58.69 minor support (14 Jan/28 October 2019 lows). A break of this price level could aim for the next support level, which at 57.47, is not too far off. Below this area, 55.59 and 53.26 are also possible support targets which could all be taken out if the Coronavirus contagion continues to transmit shockwaves throughout the market.
On the flip side, any possible market recovery from present levels would target the 60.26 price level initially, with further upside potential at 62.21 and 63.71 (neckline of June/July 2019 double bottom).