Energy stocks are a real roller coaster. They tend to move aggressively in both directions. The extreme selloff two years ago got followed by a strong rally and a significant retracement recently. So what to expect going forward? This is InvestingHaven’s energy stocks outlook for 2018.

Crude oil outlook

First of all, there is of course a very strong correlation between crude oil and energy stocks. That is why we start this energy stocks outlook with a top level analysis of crude.

Last year, InvestingHaven published this Crude Oil Price Forecast for 2017with this key take-away:

“The $35 to $40 range will act as strong support. Prices could certainly move higher, but will find secular resistance at $75 where the 2014 gap down started. So, overall, investors could go long in 2017 once crude oil prices fall towards the $40 level and close positions.”

 It was a spot-on call. Energy stocks, obviously followed a very similar path.

Our recent outlook has not changed very much compared to the one last year. In our recently published Crude Oil Forecast For 2018

“We highly suspect that if price of crude oil will achieve 60-62 USD, later in 2018. That is our crude oil forecast for 2018. If that would materialize it would be major news, so stay tuned and stay focused on the charts.”

That said, we believe that crude oil is not very far away from major resistance. Prices can always move higher, our outlook and forecast are not set in stone. So it is crucial to continue monitoring the charts once a price target is met, not only in that specific market but also across markets.

Our energy stocks outlook for 2018

Recently we published an article concluding that Energy Stocks Outlook Not Bullish Yet, It Is Neutral. Though many could be (wildly) bullish, for instance CNBC believes it is time to buy energy stocks and SeekingAlpha sees a breakout opportunity, we prefer to wait for a confirmed signal that it is time to go long. Moreover, both crude oil and energy stocks are bumping into secular resistance. Let us explain.