Following on from last weeks overview – After a fast breakout of the previous range on stronger volumes from the 108.00 handle to highs of 113.45
the Market has snapped back over the first two days of this week
with the May contract now trading around 106.50.
Monday Saw the IMF downgrading their estimates for world economic growth with A further sell-off Tuesday attributed to a Goldman Sachs piece suggesting both Brent and WTI Crude prices would fall in the coming months .
After a fast breakout of the previous range on stronger volumes
the market could not consolidate at any prices further up and we have seen a sharp rejection back into the range .
Medium term support now lies at 102.00-70 before the major support at 97.00-70 .
Freshley squeezed view
Even after two days of heavy selling off Oil remains at elevated levels.
Bulls will look to halt the sell off toward the top of the March trading range (106.50) and break its short term Resistance.
Longer term -remain bullish the Oil market and expect a test of the 120.00 handle in the coming months-
However the important psychological 100.00 handle will have there bear come out to play . Any Failure in and around this 106.50 leaves Price vulnerable to an air pocket toward > Medium term support at 102.00-70 on the cards before a Final test of the major support at 97.00-70.