Brent Crude Oil Retests Its Falling Wedge Breakout

Brent crude oil broke above a multi-year falling wedge on the monthly chart last month. This month, the price came back down and retested the trendline from above – and held. That’s a textbook breakout-retest sequence, and it’s one of the better signals you can get from a chart.

How the falling wedge played out

A falling wedge is a compression pattern where the price makes lower highs and lower lows – but the range gets tighter over time. Think of it like a spring getting squeezed. Sellers keep pushing the price down, but with less force each time. Eventually, buyers push back and the price breaks through the top.

On this chart, both trendlines slope down, with the top line starting from the 2022 highs. But they converge – that’s the wedge shape. Last month, the price closed above the upper trendline for the first time. This month, it dipped back to retest that line and bounced. Sellers had their chance to drag it back inside the wedge – and they couldn’t.

Falling wedges tend to break to the upside more often than the downside. Each lower low in the pattern shows weaker selling pressure. The sellers were running out of steam.

What to watch next

The retest held – and that’s the bullish part. When old resistance flips to new support, it tells you buyers are defending the breakout level. A second monthly close above the trendline adds weight to the move.

If the price drops back inside the wedge on a monthly close, the breakout failed – and oil’s back in the pressure cooker.

As usual, none of this is investment advice. To learn more about falling wedges and other compression patterns, check out our Compression Patterns Explained guide.