I can see a clear trend reversal after hitting a major resistance point at $50. This leads me to believe than in the short-run there is enough room for oil
to tumble. Scenario #1 is that there is a weekly window during which oil
will fall to around $45 and bounce off. Scenario #2 is that oil
tumbles down to its previous major level of support at $29. Overall I have a bearish
sentiment on oil
. This mainly stems from OPEC's inability to regulate supply. More specifically, I see no intention from S.A.
to cut its supply. This leads me to think that the market will revaluate oil
at around $30. That is mainly due to S.A.'s ability to produce oil
at a cost of $20-25 -per barrel which in the short term will create a market failure.