News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.



Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Oil - US Crude
Wall Street
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • Emotions are often a key driving force behind #FOMO. If left unchecked, they can lead traders to neglect trading plans and exceed comfortable levels of risk. Read on and get your emotions in check here:
  • Technical indicators are chart analysis tools that can help traders better understand and act on price movement. Learn more about the importance of technical analysis here:
  • The British Pound, Australian Dollar and US Dollar may all experienced heightened periods of volatility as geopolitical risks in North America, Asia and Europe rattle global financial markets. Get your $GBPUSD market update from @ZabelinDimitri here:
  • The New Zealand Dollar may continue to outperform the haven-associated US Dollar as price breaks above key long-term resistance. Get your $NZDUSD market update from @DanielGMoss here:
  • #Gold prices declined following bearish technical cues, but a key zone of support was reinforced over the past 48 hours. #XAUUSD volatility risk is elevated ahead of the #USElection -
  • What is the US Dollar outlook based on retail positioning ahead of the November 3rd presidential election? EUR/USD may fall as AUD/USD rises. Which way could USD/CAD capitulate? Find out from @ddubrovskyFX here:
  • US #COVID19 cases hit a record for a second consecutive day -BBG
  • The Indian Rupee may weaken following a breakout higher in USD/INR. Despite rising global stock market volatility, the Nifty 50 has been holding its ground. Could it capitulate lower? Find out from @ddubrovskyFX here:
  • The US Dollar gained, pushing USD/SGD to break higher. However, USD/IDR may be looking at losses ahead. USD/MYR struggled to breach the March trendline. USD/PHP could rise.Get your market update from @ddubrovskyFX here:
  • The #DowJones and #SP500 have as of today averaged: -2.16% & 1.43% 3-months and 1-year before #Election2020 respectively What could this mean for the incumbent president/Trump next week? 👇
Crude Oil Collapses into Bear Market Territory

Crude Oil Collapses into Bear Market Territory

2017-06-24 02:45:00
James Stanley, Strategist
Crude Oil Collapses into Bear Market Territory

Fundamental Forecast for USOil: Bearish

Talking Points:

The correction in Crude Oil continued this week as prices entered ‘bear market’ territory, marked by a move-lower of 20% or more from the 52-week high. WTI set a fresh 10-month low while Brent moved-down to a new 7-month low with prices in both markets falling below a series of key support levels in the process.

A bit of hope developed on Tuesday afternoon leading into Wednesday morning as two key gauges of Oil supply indicated contraction. The API U.S. oil inventory report on Tuesday afternoon showed a drawdown of 2.72 million barrels, almost entirely offsetting last week’s build of 2.75 million. This provided a brief amount of strength for Oil prices as we walked into the EIA report on Wednesday morning, and after a second consecutive weekly drawdown was reported, a very temporary reprieve began to show around the anxiety of a global supply glut. But also within that EIA report was a rise in U.S. Oil production of 20k barrels/day in the prior week, and this is what seemed to really grab markets’ attention as sellers took control of Oil prices shortly after the release of the report.

Normally, a weekly drawdown of 2.5 million barrels would stoke bullish demand with some follow-thru potential; but on Wednesday, that topside move was short-lived as sellers merely used the pop-higher to position in to short positions at better prices. No more than two hours that EIA report on Wednesday and Oil prices had already moved-down to set fresh 2017 lows, with WTI testing below a long-term Fibonacci level at 42.89.

Monthly Chart of US Oil with Trend-Line, Fibonacci Retracement Applied

Crude Oil Collapses into Bear Market Territory

Chart prepared by James Stanley

For Oil bulls this should be a concern as even bullish indications, like a supply drain, are failing to quell the month-long sell-off. That sell-off began right as the OPEC/Non-OPEC extension of production cuts were announced in May, and since that resistance was set – bids have been a fleeting theme for Crude Oil prices and this has led to the thought that an eventual re-test of the $40-handle may be in the cards; and if that can’t hold, major problems may be ahead.

Next week sees the expectation for another supply drop in the United States as inclement weather in the Gulf of Mexico is expected to have hampered production. The key focal points for Oil prices for next week are the API weekly U.S. oil inventory report on Tuesday at 4:30 PM ET, the EIA report on Wednesday at 10:30 AM ET, and the Baker Hughes Rig Count on Friday at 1:00 PM ET. Traders will surely be looking to gauge whether the recent fall in prices has started to disincentives producers, but the bar is incredibly high to reverse what has already turned into an aggressively bearish move.

Retail Positioning in US Crude Flies Higher as Retail Traders Keep Trying to Call a Bottom

Crude Oil Collapses into Bear Market Territory

Above chart indicates IG Client Sentiment in USOil, with net-long positions flying higher this week

Of particular note for trend continuation theses is the current bullish stance of retail traders. IG Client Sentiment is currently showing an imbalance of 4.33-to-1 as retail traders are continuing to try to call a bottom. Given sentiment’s contrarian nature, this would be yet another bearish factor for Crude Oil prices as we move into next week.

The forecast for Oil prices for next week will be held at bearish.

--- Written by James Stanley, Strategist for

To receive James Stanley’s analysis directly via email, please SIGN UP HERE

Contact and follow James on Twitter: @JStanleyFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.