Why Are Oil Prices Continuing to Fall?
Brent crude futures tumbled more than 3 percent to below $108 a barrel yesterday. We have broken through the 61.8% Fib retracement from 2012 March highs and the 50.0% line is acting as a nice support currently. Past 3 days candlestick pattern also seem to suggest that a “3 Black Crows” pattern has been formed.
CNBC has collated a few reason for greater bearish outlook:
- In addition to huge build in oil supplies, there's been a dramatic decline in distillate demand—down 11 percent year-over-year.
- Brent crude broke below its 200-day, 50-day moving averages and Fibonacci retracement level. These are key technical indicators—and reinforce bearish sentiment in this market.
- U.S. oil prices may be headed to $90 a barrel, after hitting $100 just last Friday.
- One short-term bear's outlook: John Kilduff of Again Capital said WTI oil could be headed toward $88 a barrel
The following article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.