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Bullish Crude Oil Bet Pays Off Against All Odds

What will WTI Crude Oil bring next? That is the subject of discussion in our latest premium analysis! Order and receive TODAY!

When it comes to the crude oil market, last month was one for the history books. The coronavirus pandemic forced the global economy to grind to a halt. This led to a sharp decline in oil consumption, while production was too slow to adapt. As a result, there was plenty of oil nobody wanted as storage capacity around the world quickly ran out.

For the first time ever, crude oil prices went negative. On April 20th, the price of the contract with delivery in May closed at -$38 a barrel. We admit we didn’t expect that anomaly. Fortunately, when the May contract expired, things got back to normal. There was still a global supply glut, but at least crude oil was trading above zero again.

And while more sub-zero prices remained a real possibility, there was also a clear Elliott Wave pattern that was worth a try. The chart below, sent to subscribers on Wednesday, April 29th, provided a bullish setup with a tempting risk/reward ratio. Take a look.

Elliott Wave analysis put traders ahead of the crude oil recovery

WTI Crude oil was hovering around $16 a barrel and the supply glut was far from over. Yet, there decline from $65.21 to $9.97 was a clear five-wave impulse. The pattern was labeled 1-2-3-4-5, where the sub-waves of wave 3 were visible, as well.

Crude Oil Approaching $30 as Market Slowly Restores Balance

According to the rules of the Elliott Wave principle, a move in the opposite direction can be expected after every impulse. Given that there already was an appropriate stop-loss level at $9.97, we thought this count was worth a try. We were either going to lose $6 a barrel, or ride the price up to the resistance of wave 4 near $30. The risk/reward ratio was better than 2:1.

Crude oil prices rise as supply-demand balance is slowly restored

Earlier today, crude oil prices exceeded $29 a barrel. $9.97 was never put to a test. In the span of three weeks during the greatest economic slowdown since the Great Depression and the biggest oil glut ever, crude oil rose 80%. Production cuts and the easing of lockdown restrictions certainly played a major role. However, it was Elliott Wave analysis which suggested the bulls might be up to something against all odds.

What will WTI Crude Oil bring next? That is the subject of discussion in our latest premium analysis! Order and receive TODAY!

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