It's been a tough year for energy investors.
The S&P 500 energy sector ETF, the XLE, has lost more than 20 percent of its value in 2015 as crude and other commodities have tumbled to multiyear lows. But for investors fishing for a bottom, one contrarian trader says we may have just witnessed a very bullish pattern on the charts.
"I see a possible triple bottom here at around $60," said AlphaShark Trading founder Andrew Keene, who was looking at a chart of the XLE. A triple bottom formation is when an asset falls to the same point three times and bounces. Technicians often view the pattern as the reversal of a long-term downtrend.
"We hit this [$60] level back in August and bounced, then in October and bounced and I think we are going to bounce again," he told CNBC's "Trading Nation " on Tuesday.
Crude oil prices briefly fell below $37 for the first time since 2009 this week before staging a stunning reversal, which gave energy stocks a boost. The XLE was up more than 1 percent midday Wednesday.
For Keene, the rally could continue, albeit slowly, through the first quarter of next year. "I think the XLE could rally to a measured move target of $70 by March," he said. That's a 12 percent rally from the ETF's current price of around $62.50 and corresponds with its November high.
Keene's call comes amid an overwhelmingly bearish picture for the oil market, as supply and demand concerns have created a mass of volatility in the space. While the potential for a near-term bounce is possible, Wall Street consensus still expects lower for longer.
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