WTIC Crude currently trading around 66.13 and local MCX Crude futures trading around Rs4203/ barrel. Current leg of uptrend is almost 7 month old without any steeper corrections. Recent exponential rise are widely believed to be from the tighter supply weak dollar and extreme short term speculators. Short term sentiment is negative which could drive the WTIC price lower towards to 64 and 62.5 levels. Short term resistance comes around 66.8 levels.
The Energy Information Administration (EIA) yesterday said US inventories had fallen to 411.6m barrels, the lowest since February 2015. Oil extended its three-year high as a 10-week record stretch of declines in U.S. crude stockpiles added to signs that global markets are burning off a chronic surplus.
Participants are positioned almost 15 longs in WTI crude against each short. This is the highest read on the long/short ratio since mid-2014. (Source Saxo Bank ). This sort of extreme one sided speculation is not a good sign for the current prevailing trend often poised for short term price corrections.