Crude oil fell in five waves from 105.20 to 97 dollars. This whole decline happened, despite the Russia-Ukraine conflict and the expectations that it will push prices higher. It happened, because fundamental factors, news and events lag the market and have no impact on it in the long term. And just when everyone accepted that the trend has turned down it was time for it to go up again.”Trend direction is now expected to reverse for a while, since we have to prepare for a three-wave rally.” This forecast is from our previous analysis on crude oil. As shown on the chart below, crude oil did rose in three waves from 97 to 100.25. However, this upside retracement is a shallow one. 38.2% Fibonacci level is the minimum for second waves. Prices could start falling again from current levels, but we have to be aware of the possibility for a more complex correction.
In other words, rally could extend, but as long as prices are held below 105.20, bears will be in charge. Considering our big picture scenario we expect figures beneath 90 dollars per barrel in the long term.