themarketzone
Long

Oil below 40$ - Two important levels to monitor now - Update

NYMEX:CL1!   Light Crude Oil Futures
On my latest analysis I mentioned two patterns in Crude Oil:
1. Monthly Bullish Bat (yellow)
2. Weekly Head and Shoulders patterns (neck line in red dashed line)

As it looks right now, the neck line of the weekly Head & Shoulders pattern was broken last week. If it wasn't December and a week before FOMC, I'd take this signal very seriously.. But it is.. and I have to consider the option that we may see a huge short squeeze in oil             that will lead to a weekly reversal.

The monthly bullish pattern is still valid and the price is very close to re-testing the X point level (also testing the spikes lower trend line (green dashed line) – 33-35$ is now in focus as it'll play as a weekly support zone . A breakdown of this support zone can lead Oil             prices towards the 20$ zone

40$ is now a strong resistance zone and the first target zone you should consider if you intend to bet on a bullish move.

Comment: Pay attention - Monthly double bottom near X with trend line support
Comment: Pattern barley holds - but still valid!
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