It hasn't been a great few months for oil, but one technical analyst believes crude could be headed for $70 per barrel in the near future.
Despite bearish outlooks like from Goldman Sachs, which predicted this week that oil will be trapped in the $45 to $50 range, Orips Research chief market technician Zev Spiro sees oil surging again. This time, it could rally about 50 percent above current levels.
According to Spiro, oil's impending rally has been building from a technical perspective since last year. Looking at a weekly chart of crude, Spiro points out that a "head and shoulders bottoming pattern" began in July of last year. An inverse head and shoulders pattern like the one on Spiro's weekly chart is seen as an indication that an uptrend could be on its way.
There's one more thing Spiro needs to see before he's sure.
"This large complex bottoming pattern could trigger a confirmed move above the horizontal neckline in the $50-$51 area," he said Thursday on CNBC's "Futures Now." "[This] would signal a primary uptrend with a minimum expected price objective in the $73 to $76 area."
But the surge may only come after more losses for oil in the short term. A daily chart of oil shows Spiro that a so-called "bearish evening star pattern" formed in August, which could spell more movement to the downside in the next few weeks.
"The pattern indicated minor resistance at the height of $48.75 and a possible pullback in the near term," said Spiro.
Nevertheless, Spiro maintains a bullish outlook for oil based on long-term patterns that he sees developing.
"Despite the potential for lower prices in the near term, the overall picture is bullish as prices are forming the right side of this large bottoming pattern," he explained.
Based on what he sees in the charts, Spiro argues that investors have two potential buying opportunities in oil. The first would be when oil pulls back to its current support around $43.50, and the second when oil breaks above Spiro's neckline area of $50 to 51.
On Friday morning, oil traded around $47.