OIL BREAKING DOWN

Oil just broke Keith’s intermediate term support line of $95.34. While gasoline inventories are near all time lows in the U.S., which suggests demand for Oil in the U.S. should increase in the short term, it is difficult to make the case that demand will increase globally in a slowing global economy. It is likely that credit constraints, as we have been hammering home in our series of Ted Spread posts, only accelerates declining demand for Oil and other commodities. Our models have the next level of support at $91.07.

Daryl Jones
Managing Director