Normally, ratio between nearest months should be stretched around the bottom of the strong down trend. You can use this indicator to support your decision to oil at the lower price.
I don't suggest to use CL1!/CL2! as leading data because the spread between this two contacts are very close and quite stable. I suggest you to use CL3!/CL4! and CL2!/CL3! instead. The result looks much more useful than the nearest contact.
PS. This indicator work for WTI Crude oil and Brent crude oil for daily/weekly data.
I don't suggest to use CL1!/CL2! as leading data because the spread between this two contacts are very close and quite stable. I suggest you to use CL3!/CL4! and CL2!/CL3! instead. The result looks much more useful than the nearest contact.
PS. This indicator work for WTI Crude oil and Brent crude oil for daily/weekly data.
