It Seems Oil Has Bottomed Out in the Mid-$20.00s – Rabobank
According to Strategist at Rabobank Christian Lawrence, the barrel of crude oil could have bottomed in recent lows in the mid-$20.00s.
“Last month we noted the double bottom formation in WTI formed by the January and February lows and that a move above 35 would usher in a target of 44. In the event, this formation proved a good signal with prices rising to just shy of the target with a 41.90 print”.
“In terms of technical indicators, the relative strength index and slow stochastics indicator have both turned lower signaling some trend exhaustion but the signals are not strong enough for us to trade a reversal with conviction”.
“Returning to our longer term global view in which we expect sentiment to sour again this year, although this would of course bode negatively for oil prices we do not expect to see a new low and believe the mid- 20s will now act as a floor”.
“That said, as per before when we were heading into the mid-20s, we see 20 as the absolute potential low – although trading that low is certainly not our base case”.
(Market News Provided by FXstreet)