Light Crude oil prices have dropped an alarming 68 percent since the start of 2020. Brent prices are down 60 percent over the last four months. But recent price action appears to show that the worst of oil's decline is likely over.

As the world economies are still being mauled by the effects of COVID-19, there are growing signs that oil prices are starting to recover.

Light Crude oil prices have stabilized over the past week and today's trading pushed the price above the key resistance level $19.27.

Buying pressure has been building over the last six weeks and today's movement suggests that higher levels are likely coming in May.

Our models forecast WTI to reach $32 by late May.

Stocks that look particularly interesting at this junction on the TSX are Whitecap Resources (WCP), MEG Energy (MEG), TORC Oil & Gas (TOG) and Crew Energy (CR).

On the NYSE, Concho Resources (CXO) look attractive.

Bottom line: Markets are anticipating that the global economies have seen the worst and now are expected to start the slow process of regaining strength.

The energy sector is one area that will strongly benefit from the recovery. Traders are starting to bid up many energy companies in anticipation of the economic rebound. We feel these five stocks look particularly attractive at this time.

By Donald W. Dony, FCSI, MFTA
www.technicalspeculator.com

COPYRIGHT © 2020 Donald W. Dony
Donald W. Dony, FCSI, MFTA has been in the investment profession for over 20 years, first as a stock broker in the mid 1980's and then as the principal of D. W. Dony and Associates Inc., a financial consulting firm to present. He is the editor and publisher of the Technical Speculator, a monthly international investment newsletter, which specializes in major world equity markets, currencies, bonds and interest rates as well as the precious metals markets.

Donald is also an instructor for the Canadian Securities Institute (CSI). He is often called upon to design technical analysis training programs and to provide teaching to industry professionals on technical analysis at many of Canada's leading brokerage firms. He is a respected specialist in the area of intermarket and cycle analysis and a frequent speaker at investment conferences.

Mr. Dony is a member of the Canadian Society of Technical Analysts (CSTA) and the International Federation of Technical Analysts (IFTA).

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