WTI: 53.50 support tested on global glut worries

• Sellers return in sync with risk-aversion, as global growth concerns continue to bite.
• Headed back to YTD lows of 52.77 amid rising US supplies led global glut worries.

WTI (oil futures on NYMEX) sellers quickly returned to the markets on Thursday, having witnessed a dead cat bounce a day before, as oversupply worries and slowing economic growth concerns continue to dampen the sentiment around the black gold.

The barrel of WTI broke its Asian consolidative channel to the downside and fell sharply after the global growth concerns remerged and spooked the European markets, denting the demand for the risk assets such as oil.

Meanwhile, swelling US crude inventories added to global supply glut concerns and collaborated to the renewed weakness in oil. The latest US Energy Information Administration (EIA)  data showed that the US commercial crude oil inventories climbed by 4.9 million barrels to 446.91 million barrels last week, its highest level since December while the crude output levels stayed at a record a record 11.7 million bpd.

The black gold is likely to retain the bearish pressure and will test the 2018 lows below the 53 level, as the holiday-thinned liquidity could exaggerate the declines.

WTI Technical Levels