No matter how sharp the rallies are, crude is finding wave of selling pressure. Two days back North American benchmark, WTI staged a more than 8.5% rally after dropping below $30/barrel, however there hasn't been much of a follow up for the past two. Crude price in fact declined yesterday and again down today.

Relentless rout in Crude probably prompted another US investment bank to cut its forecast. Morgan Stanley joined the band wagon. This time around, new forecasts are pretty bearish.

According to the bank Crude is likely to average $30/barrel in 2016, compared to $49/barrel previous forecast. It has axed 2017 forecast by $31/barrel to $41/barrel.

The bank isn't expecting Crude to bounce back even in later half of the year. It expects price to average $29/barrel in fourth quarter.

We at FxWirePro, feel that Crude could drop further and towards $20-22/barrel, however as of now it is showing signs of consolidation and we think, given the volatility rise, Crude might move higher to trade as high as $40-42/barrel, before declining further. Overall trend undoubtedly remains bearish.

WTI is currently trading at $31.5/barrel and Brent at $34/barrel.