Technical Analysis On Oil: WTI Crude Nears Gap Fill

Technical Analysis On Oil:

WTI crude oil continues to hold strong, crossing above $40/bbl today. As a V-shaped recovery is taken as a given by most investors and analysts, price has moved higher from a low of -$40 to +$40. However, this amazing move may be on the verge of running out of steam. There is a monster gap on the WTI crude oil chart at $41.25. Technical analysis on oil signals this is the likely stopping point and reversal point on crude. The chart is clear and price will run into a major level at $41.25.

Based on calculations, crude could fall from $41.25/bbl to as low as $20/bbl. This means a potential for 50% downside to investors who decide to pull the trigger and short. I plan on doing it myself as a swing trade utilizing the SCO, a 2x inverse ETF.

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Disclosure: None.

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