Crude oil is one of the most widely traded commodities and besides its use for fuel and energy; oil-based products or its by-products find their way into every facet of our lives. Its price is affected by the economic backdrop as well as political and climatic developments.

Carrying out analysis based on fundamental, political and climatic effect is beyond my ability and resources. However, studying price charts and applying varying approaches of technical analysis could give us some clue of its likely future behaviour. That being said, it is subjective and the actual path, extreme pivots or turning points may vary from the ones we anticipate. Nevertheless, it can still be useful in developing a general roadmap for planning future trades and can be a useful educational exercise in live analysis of the market.

So with that caveat, to start with, we can make some general observations from the chart above as follows:

1. Crude Oil made a historic high in July 2008 at just over $140 when many analysts from well known investment institutions were calling for oil to reach $200.

2. Then the price dropped so sharply in less than 6 months and formed a low at $32.40. It retraced some of that decline forming a high around $114.83, taking almost 2 and half years. Chart paints a clear picture showing that since then, it has struggled and been developing lower highs and lows and the cycle still appears to be in progress.

3. Last major low was formed in February 2016 at $26.05. It is noteworthy that as we were approaching that low, there were analysts calling for oil to drop to $10. I published a chart explaining why we are likely to find a low around $25 and if we drop below that, it is likely to remain well above $20 and could bounce to around $60 over several months.

4. We are now at the threshold of $60 and some are anticipating oil to attain $70 – $80 and even $100. Is this likely, though, or just wishful thinking?

Timing Analysis– let’s address the timing element to see when the next turn is likely to form: