Crude prices rallied sharply in the last few days, boosted by downward revision of US oil output and hints that OPEC may consider production cuts. October 2015 futures (Nymex Light Crude – CLV2015) tested resistance at $50/barrel before falling just as steeply on weak manufacturing data out of China.
Expect another test of support at $38/barrel. Breach of support would offer a target of $26/barrel*.
*Target: 38 – ( 50 – 38 ) = 26
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