History is repeating itself on Nymex, and although $10 oil looks a long shot, technical analysis indicates that prices have further to fall.
The weekly Nymex crude oil futures chart shows a repeat of the downtrend behavior that has characterized the oil price since the collapse began in 2014 September, with the fall below critical support at $38 a gap down from the previous weekly close of $39.94.
These dramatic gap-down moves have been a feature of the oil price collapse, and usually they signal a very fast fall to the next support level.
Meanwhile, the fall below $38 has invalidated the bullish consolidation pattern that appeared to develop from March to October. This pattern failed to develop.
Some analysts have suggested $10 is the downside target for oil. The charts suggest a fall to this price level is a low probability. But the fall below critical support near $38 does change the nature of the oil price behavior.