WTI Crude Oil (current price: $46.05)
Oil took out several important support levels on Thursday as it plunged lower to new correction-lows. The commodity is now 15% below its recent rally high at $52, after rallying more than 80% since February from a historic bear market low of $28. U.S. Crude Oil Inventories declined by a more than expected 2.2 million barrels last week, but WTI Crude declined even more following the release. Oil fueled an advance in the value of the Canadian Dollar and the Aussie, among other currencies, and traders now expect a correction in the related crosses as well.
Our assessment: Oil is finally showing weakness after four months of relentless strength, and a retest of the $41.50 is possible if the negative sentiment towards the crucial commodity persists.
