Can Oil Reach $54 And Higher?
Alexandros Yfantis | Oct 15, 2017 02:59AM ET
When oil was trading above $52 in late September and everyone was again bullish, I warned bulls that a pull back towards $49 was imminent and the signal would be a break below $51.30. Now that price has bounced and reversed off the $49 price area, we are seeing a possible bullish trend continuation pattern.
A clear Head and Shoulders pattern has been created. The neckline and resistance is around $51.60$ and although price marginally crossed it on Friday, we did not have a clear breakout. A 4 hour close above it or at least a 2 hour close above it will open the way for the pattern's target.
My target is at $53.50 I can see this move extend higher very easily. At $52.6 we find the next most important resistance level but if the neckline is broken, the chances of breaking to new highs will increase dramatically. Of course oil bulls do not want to see price fall below $48.80$ as this will put the blue trend line into a test and the August lows in danger. Trend is bullish and I expect the neckline to be broken and oil's price reach our target and why not higher.
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