March 9 (Bloomberg) -- Crude oil may rally to $55 a barrel in New York within weeks if prices signal a “double bottom” by rising above $48.59, according to technical analysis by FuturesTechs.com Ltd.
A double-bottom is a “W-shaped pattern, with two similar lows” and “once the high between the two lows is breached we get a buy signal,” FuturesTechs director Clive Lambert said in an interview today from Southend-on-Sea, U.K.
“A move through $48.59 may trigger that buy signal and a rally with an initial target of $55,” Lambert said. “But while we’re below that there’s a danger we’ll remain rangebound.”
The chart shows that the highest price reached between crude’s lowest points on the New York Mercantile Exchange this year was at $48.59 on Jan. 26.
Oil futures last traded at $45.61 a barrel on the Nymex, having gained 2.2 percent this year. Prices will rebound to average $50 a barrel in the second quarter, according to the median of 33 analyst forecasts compiled by Bloomberg.
To contact the reporter on this story: Grant Smith in London at gsmith52@bloomberg.net
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