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WTI Crude futures are currently trading at $47.35-lower by 2.91% as compared to the previous closing price. The contract fell for the fifth day on Thursday to its lowest since January 2019.
Brent crude futures were trading at $51.31-lower by 2.93% as compared to the previous closing price.
Crude prices dropped today as an increase in new cases of the corona-virus cases outside of China fueled fears of a pandemic which could slow the global economy and lower crude demand.
During the last five trading sessions, the Brent has lost 11% while WTI has dropped 10.6%. It is the biggest five day percentage drop since August 2019.
Crude oil lost nearly 3 per cent on Thursday after the CDC confirmed the first positive corona-virus in US. The origin of the virus is unknown.
On Wednesday, for the first time ever, the number of new corona-virus infections outside China, the source of the outbreak, exceeded the number of new Chinese cases.
The spread to large economies including South Korea, Japan and Italy has caused concerns that fuel demand growth will be limited. On Wednesday, consultants Facts Global Energy forecast oil demand growth will only 60,000 barrels per day in 2020, or “practically zero”,
According to Energy Information Administration report the US Crude Oil stockpiles increased by 452,000 barrel to 443.3 million barrels.
On the technical front, on the daily chart the fast moving MACD line have crossed slow moving MACD line which indicates strong bearish momentum in the market. The slope of 13 and 26-day EMA indicate strong bearish sentiments in the market. The RSI and stochastic indicates market will move in downward direction.
TRADE SUGGESTION- SELL@ 47.30, STOPLOSS@ 47.60, TARGET@ 46.70