Bids have been few and far between for oil over the last two months. Since peaking in early June, the commodity has essentially been straight down. As shown below, prices have been extremely depressed over the last couple of weeks, moving lower day-by-day along the bottom of its trading range.
While oil saw a bounce off of its 200-day moving average last Friday, it couldn’t hold its 200-day on a re-test today. This break also marked the beginning of a new bear market for oil, which is defined as a 20%+ decline from a bull market high. At current levels, oil is down 21.7% from its high 54 days ago on June 8th.
Below is a list of historical oil bull and bear markets since the early 1980s when data begins. The prior bull market that just ended for oil was a strong one at +95.5%. That’s much stronger than both the average and median gain seen for historical oil bulls. Now that the new bear market is official, how low will prices go? Well, the average bear has seen a decline of 34.6% from high to low, while the median bear has seen a decline of 31.4%.