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Crude Oil Price Forecast – Crude Oil Markets Get Hammered After Inventory Figure

By:
Christopher Lewis
Updated: Mar 11, 2020, 17:18 UTC

Crude oil markets initially rally during the trading session on Wednesday, but with the inventory figure coming out much bigger than anticipated, it suggests that there is even further downward pressure to come.

Crude Oil Price Forecast – Crude Oil Markets Get Hammered After Inventory Figure

WTI Crude Oil

The West Texas Intermediate Crude Oil market initially rallied above the $35 level on Wednesday, in an attempt to try to fill the gap. Having said that, the market has also turn right back around after the inventory figures showed a build of 7 million barrels, as opposed to the anticipated 2 million. The markets are reeling from the idea of the coronavirus killing demand, and of course the fact that the price war started by Saudi Arabia is going to flood the market with even more supply. The question now is whether or not someone blinks in this big game of “chicken.” At this point, rallies are to be sold all the way up to the $42 level. Signs of exhaustion are to be jumped on.

Crude Oil Video 12.03.20

Brent

Brent markets initially tried to rally during the trading session as well, reaching towards the $40 level. The $40 level of course is a large, round, psychologically significant figure but at the end of the day there is a huge gap above that still hasn’t been filled. The $45 level has been the beginning of a major gap lower, so with that being said it’s likely that we will continue to see rally sold into as there is no sign of a longer-term solution quite yet. At this point, I like the idea of selling in the rallies going forward, perhaps aiming for the $35 level again as this is a market that faces a multitude of headwinds right now. Overall, this is a market that continues to show extreme softness.

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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