The highlight of the previous month was the first monthly increase since June when crude oil began declines. The commodity gained 3.49% and bounced of the Apr 2009 lows once again, which encouraged oil bulls to act and translated to further rally in the recent days. As a result, light crude climbed above $51 and invalidated the breakdown under important short-term support line. Does it mean that the worst is behind us? Or maybe this is another pause before new lows?

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Although crude oil extended losses, slipping under the Apr 2009 lows and hitting a fresh multi-year low of $43.58 at the end of the previous month, the commodity rebounded very sharply earlier this week. The recent jump in oil prices prompted speculation that the market had bottomed out. Although yesterday oil prices dropped again, the question whether the bear market is close to the end remains. What are the prospects for the oil prices?

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In Dec crude oil lost over 18% as ongoing expectations of growing supplies and concerns over the pace of global growth weighed on the price. As a result, the commodity dropped below the 61.8% Fibonacci retracement (around $65 per barrel), which accelerated declines and took light crude to the support zone created by the 76.4% and 78.6% Fibonacci retracement levels (based on the entire 2009-2011 rally). Unfortunately for oil bulls the beginning of the year brought a breakdown under these levels, which resulted in a drop to the next support area created by the Apr 2009 lows. Will we see a rebound from here? Or maybe this is another pause before new lows?

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In Nov, crude oil broke not only below the psychologically important barrier of $80, but also under the 50% Fibonacci retracement based on the entire 2009-2011 rally, which accelerated declines and resulted in a multi-year low of $65.69. On top of that, the first day of Dec was also very negative for oil investors as the commodity extended losses to $63.72 and slipped below the solid support zone created by the Aug and Sep 2009 lows and the 61.8% Fibonacci retracement level. The breakdown was invalidated almost immediately, but is it enough to trigger a trend reversal? Will the current picture of the USD Index and the gold-to-oil ratio give us more clues about future moves? If you want to know our take on these questions, we invite you to check out our Oil Investment Update. Have a nice read.

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Without a doubt, Oct was the worst month for oil bulls since May 2012. In the previous month, the commodity lost over 11% as the combination of a stronger greenback, rising supplies and weaker demand weighted on the price. Additionally, the first days of the new month have been very negative for oil investors. After the breakdown below the psychologically important barrier of $80, oil bears pushed the price lower and light crude hit a four-year low of $75.84, breaking under long-term support lines. In this way, the commodity posted its sixth weekly loss in a row. Will light crude drop any further in the nearest future? Is it possible that the stocks-to-oil ratio will give us some interesting clues? We invite you to check our Oil Investment Update. Have a nice read.

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