Decision time for Brent

[FiringSquad13]

Last week, Goldman released a note in which they said that they could forsee $20 per barrel for oil.  I personally cannot see this but stand to be proved wrong.

 

The chart below for Brent shows that the downside prevails and without a dip below the lows or a breakout of the current trend could see the market reach a crucial decision point mid October from a technical point of view.

 

What are investor's thoughts on Goldman's $20 and do you forsee a test of the lows?

[RichTheNewbie]

Seriously doubt $20 will happen. I'm sticking to my prediction from a month ago which it's followed like clockwork so far:

 

"No chance this is the bottom. Some chance of an Aug/Sept rally but the headwinds are terrible for oil.

Using WTI as the benchmark you might hope for 45-50 but it'll go back to 40 afterwards and probably into the 30's. I don't think it'll hit the $30 predictions as too many people will start to buy long-term longs. You might get $32 optimistically, but more likely $35-$38."

 

If you believe in TA it looks like a descending triangle formed between the start of the month and now so should be seeing a further drop before too long.

[RichTheNewbie]

Should point out I'm referring to WTI still but that doesn't matter too much

[Guest FoxTrader]

Personally, I do not see it going to $20 a barrel. Imagine the chaos it would create with stocks piling up and rigs cutting back on production. Job losses, the Middle East..... BUT, stranger things happened in the past....

 

happy days

[FiringSquad13]

 exactly what I was thinking.  I cannot imagine many producers having a B/E at $20 or below.  I think the Saudis would step in if it got anywhere near there.  Production levels in the US ar dropping so that could see a bit of a bounce with WTI (maybe!).  I expect a further cut in rigs in the US. 

[Guest tiger131]

I would take a long term view and keep isis and russia in mind even if it went down below 20 or 10 any new conflict could spark it off up again.