nmike

OIL..... a "V" shape RECOVERY or a longer DIVERGENCE BOTTOM?

Short
FX:USOIL   CFDs on Crude Oil (WTI)
52
I've set the RSI at 60/ 40 instead of the standard 70/30, by doing so we have a better view of weak price up-strength. As you can see since early 2012 the RSI failed to move above the 60 level along with low levels of Trix , see example of EUR/USD chart posted in commentaries. RSI failed to move any higher and instead trend line support was broken and downside began. The last 3 (A)(B)(C) bottom reversals began with RSI rising above the 40 level and a shorter Trix bar, there was a fake 40 level break at (A) but that produced a reliable positive divergence reversal signal. Due to the nature of this down move I suspect we will get a “V” shape recovery without divergence just like we had at point (C).
Currently price is just above S1 support, if breaks next likely target is about $40.