Premature Reversal Signal
Keep in mind that we are still in a primary-term downtrend on Oil (OIL), so I wouldn’t be hasty trying to pick bottoms here.
But, what I am proposing in this post can be nullified and be as nothing or it could be the major reversal signal on Oil. What you are seeing is a weekly-chart with MACD oscillators on the below chart. Technical analysts will call this “bullish divergence” (price-action making lower-low while the MACD is making higher-low) which is signaling there can be (possibly) some clandestine buyers here. Still, it’s at a very early stage so we do need to see a confirmation before taking it seriously. As you can see,that the MACD hasn’t even crossed to the upside yet; and with all signals/indications, we need the price-action to substantiate for authentication of that signal.
Anything long-term trade, I wouldn’t even think about going long until it reclaims well above $12.70 to $13.00 level on OIL which is the resistance that needs to be conquered for buyers to show up. Like many other major reversal signals, it will give you head-fakes and traps, so being patience is the key on this setup. I personally think, we probably not going to see a full confirmation until early next year, but I thought it would be worth watching it and see how it plays out throughout the year.
Weekly-Chart with MACD