Oil Suffers Big Drop

A bad day for the “black gold” as it withdrew from the recent highs quite violently due to a report on increased inventories by 8.5milion barrels ,much greater than analysts expected.Oil(WTI) is set to end the session below the 92$ mark,the lowest since early August.
The 38.2% fibo level seems to be holding for now,and should it be tested,it will likely provide a strong support.Worth noting,is the fact that both the 200 MA and the 50 MA were breached,while the upper band defined by the three tops is setting a solid downward channel.

In our latest post related to oil,we commented on the critical-in a technical perspective-situation,that it was.The latest action confirms this view,while the tremendous spike in volatility -OVX reached a 3-year high of 75-is in line with what we expected.

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