“Oil prices have been drifting lower since March as investors get concerned about slowing global growth and the US dumps more and more of its strategic reserve into the market to help keep a lid on inflation,” Michael said.
“Of course, growth will pick up and that strategic reserve will need to be topped up therefore creating further demand for oil.
“In the meantime, however, share prices of energy stocks have fallen all year along with the oil price.
“Are there signs yet that we are close to a bottom?” Michael asked.
“Looking at the chart for WDS (see below), we’re starting to see some early possibilities of this occurring.
“WDS has been drifting lower in the past year, but we finally have a sign that it might be turning around.
“The low in November was higher than the low in September, so WDS has now made its first “higher low”.
“The recent move higher has also been on healthy volumes.
“For those looking to move early, WDS is potentially a buy here with a stop just under the November low.
“For more conservative investors, we need to see it make at least a “higher high” by pushing above the October peak.
“If that were to occur then we could then reassess, but potentially over the next several weeks we will have some evidence that WDS has broken the downtrend and is preparing for a more sustained move higher,’ Michael said.
Woodside Energy (WDS)
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