Summary:
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Crude oil set for another day of heavy losses
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WTI falls below $58 a barrel to lowest level of the year
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Market on course for incredible 12th losing day in a row
The large drop in oil has shown little sign of any let up this afternoon with another wave of selling hitting the markets. Both Brent and WTI are lower by more than 2% on the day and given the failure to hold onto gains yesterday on what was quite clearly positive news it doesn’t bode well going forward. It’s amazing how quickly sentiment can change in the markets with price hitting 4-year highs just over a month ago, but with Oil.WTI now in a bear market and barring an unlikely recovery into the close it is set to post a 12th consecutive red candle on the D1 chart.
Oil is selling once more today and on course for a 12th consecutive daily decline as the bear market continues. Source: xStation
Given this strong recent sell-off which has seen the market fall by almost $20 in just 7 weeks there is a temptation to think it may be overdone and should the market continue lower then OPEC may well look to intervene at their bi-annual meeting next month. Earlier the organisation did little for crude bulls however as they revised lower their demand forecast for the 4th consecutive month. The cartel forecast global appetite for crude to grow by 1.29m barrels per day in 2019 - 70k lower than the projection from last month. At the same time, OPEC see output from non-member nations increasing by 2.23m bpd next year, up 120k from the last forecast.
Oil.WTI has pulled back to an interesting level from a long-term basis with the market falling into the 38.2%-41.4% fib at 57.35-55.72. This region could be seen as possible support and any bullish reversal signals around here could represent attractive buying opportunities. Source: xStation
