Tuesday, crude oil lost 2.10% as worries over conflicts in Ukraine and Iraq waned. As a result, light crude dropped to its lowest level since Jan 21 and slipped below an important support area, hitting an intraday low of $94.26. Will the commodity correct to $93 per barrel in the near future
Yesterday, the U.S. Commerce Department showed that the number of building permits issued in July jumped 8.1% to 1.052 million units (beating expectations for a 2.5% increase) and U.S. housing starts soared by 15.7% last month to hit 1.093 million units (well above expectations for an increase of 8.6%).
Additionally, the U.S. CPI rose 0.1% in the previous month, while core consumer prices (without food and energy costs) increased by 0.1% last month, missing expectations for a 0.2% gain, but the year-on-year rate came in at 1.9%. Despite these bullish numbers, the price of light crude declined to almost eight month low as concerns over tensions in Ukraine and Iraq eased.
How much more room to decline does the commodity have? Let’s check the technical picture and find out :
Trading position (short-term; Sunshine Profit opinion): In their opinion no positions are justified from the risk/reward perspective.