WTI Oil: Buyers should lower target price. Long term approach.

After a dramatic and historic day for Oil came to a close, the price reached $27.40 on Monday, making contact at the same time with the long term upper Lower Low trend line of the multi year Channel Down on the 1M chart (RSI = 33.568, MACD = -2.190, ADX = 13.260, Highs/Lows = -17.0871). That was the first time we entered this zone since February 2016 and the $26.00 market low.

The bullish reaction on the 1M candle is instant and if the month (March) closes this way then the candle sequence will be similar to the last two Lower Lows on that Channel Down, in January 2009 and in February 2016. If that happens then we have a bottom for the next 2 years at least and long term buyers can step in but with a lower Target Zone: 48.50 - 54.00 as the Lower High trend lines don't leave room for higher upside.

We don't exclude the possibility of a more lengthy consolidation on that Bottom, as in 2009 it took three monthly (1M) candles to price the bottom and in 2016 two. Note that this investment suggestion is only suitable for long term investors with a 2 year horizon and not short term traders.




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