WTI crude oil prices fell below $38/barrel during Monday’s global market swoon as they headed for their 11th consecutive weekly decline. That was until a 6%+ rally took hold during the last 24 hours:
Amazingly enough the rally since Monday’s low is the largest rally in crude since the brutal downtrend in commodities began in late-June. The breakout above the downtrend line offers the possibility that prices could rally back to an important area of previous support near $43.50 in the near term. Perhaps more importantly $37.75 could turn out to be a major low for WTI – a rally back above $44 would go a long way toward confirming that we have indeed just put in a major market low.