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Crude's Carnage to Continue and Break the 2009 Low

Crude's Carnage to Continue and Break the 2009 Low

Crude Oil WTI NYMEX:CL1!

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.... On a market technician's viewpoint, if fundamentals do not shape up quick with support from consumption economies, like the U.S. and China, crude could break 2009's low of $33.20 per barrel.

I also expect the dollar to continue to rise, increasing deflationary pressure throughout 2016.

Price support is currently $42.02, just $2.22 per barrel less from where it is trading today. 2008's high of $147.27 per barrel creates a "V" shaped support and resistance price channel, which will likely hold prices.

If prices break through this key support level, selling could amplify if there is no catalyst to bring prices back north. A "demand" zone - an area where confirmed buying took place - between $38.34 and $34.04 will be the last line of defense for crude prices.

A close below this level, and a target of $27.14 per barrel is initiated.

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