4 Charts Make The Case That Crude Oil Has Bottomed
An in depth technical analysis of crude oil might reveal that the commodity is in for a major turnaround.
Crude oil, which is down 9 percent yr up to now, is oversold, based on Piper petroleum products inc wv 60 Jaffray managing director and technical market strategist Craig Johnson. He also recommends taking bullish positions on vitality stocks, which have a tendency to maneuver in tandem with crude oil.
The commodity’s oversold condition could be present in charts of crude oil over the past year, in accordance with Johnson. He zooms in on just a few key technical indicators: moving averages, the relative-strength index, the money-circulation index and its shifting average convergence/divergence indicator.
“All these pieces, when you place them petroleum products inc wv 60 collectively, counsel that crude oil is oversold and due for, I believe, a pretty healthy bounce,” Johnson said Friday on CNBC’s “Trading Nation.”
Crude oil has appeared to carry steady up to now year every time it is gotten down to its 40-week shifting common, then emerging with a meaningfully rally, Johnson said, analyzing a chart that exhibits an upward-sloping channel.
“One thing related appears to be like like it is unfolding proper now that would take the oil worth again above $50 after which possibly as high as $55. So positively like what we’re seeing here, for at least a brief- to intermediate-term commerce and possibly slightly longer,” he stated.
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