Fibonacci Extension Target Zone
Using a 61.8% Fibonacci extension, the target area is $77–$87. A move above the wave (I) high would confirm a new weekly upward sequence. If that confirmation occurs, price targets move to the $103–$119 equal-legs zone. The analysis also projects a move towards new all-time highs. Further acceleration is linked to the start of wave III of (III). The expectation is for stronger upward movement once that wave begins. Following the bottom we saw back in April 2025 at $34.78, Occidental has been on a strong upward trend. The stock is now approaching the upper end of its initial target zone of $77-$87, which is a key milestone for this first rally. This move is fundamentally supported by WTI crude prices, which have recently stabilized above $95 per barrel due to persistent global supply concerns.Options Positioning For Wave Three
For derivative traders, this suggests a potential consolidation period in the near term before the next major advance. Considering this, selling out-of-the-money puts with strike prices around $75 or $80 could be a strategy to collect premium while waiting for the next move. Any short-term weakness in the coming weeks could also present an opportunity to purchase call options at a better price. The real opportunity appears to be in positioning for the powerful wave III, which targets the $103–$119 area. We believe this makes buying call options with 3 to 6 months of duration, such as the September 2026 $95 or $100 calls, an attractive way to capture this anticipated acceleration. This longer timeframe allows for the full bullish sequence to develop without suffering from rapid time decay. This technical view is reinforced by Occidental’s strong performance, having beaten earnings expectations for the fourth quarter of 2025 with reported free cash flow of over $2.1 billion. From a historical perspective, the current implied volatility of around 35% remains below the peaks over 50% that we witnessed during the 2022 energy spike. This suggests that options are still reasonably priced relative to the stock’s potential for explosive moves. In the immediate weeks ahead, the key signal to watch is a definitive break and hold above the recent wave (I) high, which is currently near $87. Confirmation of this breakout would validate the entire bullish structure, likely attracting a new wave of buying. Therefore, setting alerts for this price level is critical for timing the entry into more aggressive bullish positions. Create your live VT Markets account and start trading now.
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