Oil prices fell to seven-month lows on Tuesday, as traders continued to grapple with a market that is oversupplied.
According to Paul Ciana, a technical strategist at Bank of America Merrill Lynch, oil is headed even lower and could revisit levels it hasn't hit in over a year.
"Oil is in a downtrend and risks trending into the $30's," Ciana said.
"The decline in oil prices has paused at the bottom of the downward sloping channel with support at $44.09 and resistance at $46.75 and $48.70," Ciana said. However, he said, a close below the support of $44.09, the level below which traders had not allowed oil to fall, is bearish.
The Organization of Petroleum Exporting Countries, a cartel of key producers, has had a tough time rebalancing the oversupplied market. After agreeing to curb production for six months starting in January, OPEC decided in May to extend cuts for nine more months.
Source: Business Insider
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