close icon

Crude Oil Walking the Elliott Wave Path

The price of crude oil initially rose to $44.68 on Monday, but then the bears took over again, which led to a decline to $43.05. But instead of continuing to the south, oil rebounded sharply up and is currently trading above the $46 mark. You might even think that the price is deliberately moving up and down and up again just to enrage you and take your money away. Relax, it is nothing personal. In fact, with the proper analysis, anyone could have taken advantage of oil’s behavior, just like our premium clients did. They received the following chart on Monday, September 19th, before the markets opened.(some marks have been removed for this article)
crude oil-4h-19-9-16
As visible, we assumed that a five-wave impulse to the downside has been in progress since the top of wave “c”. The problem was that its fourth and fifth waves were still missing, so we were expecting a small recovery in wave 4, followed by another decline in wave 5. Next, once the impulsive decline was over, a significant recovery was supposed to begin. Believe it or not, Elliott Wave analysts can extract all that information from a chart. Nothing else was needed to make that forecast. Today is Thursday, so let’s see how the price of crude oil has been developing during the last four days.
crude oil-4h-22-9-16
Fourth waves usually terminate within the area of previous fourth waves. So, it is not surprising that wave 4 ended at $44.68, slightly below the highest point of wave iv of 3. Then crude oil plunged to a new low in wave 5, but since every impulse is followed by a move in the opposite direction, instead of selling the bearish breakout, traders should have been preparing for a rally in crude oil. As you can see, the Wave principle can not only help you predict a reversal, but to anticipate a series of consecutive price moves in both directions. We cannot think of another method capable of doing that. Could you?

Stay informed with our newsletter

Latest Elliott Wave analysis on different topics delivered to you weekly.

Privacy policy
You may also like:

Bullish Crude Oil Bet Pays Off Against All Odds

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…

Read More »

A Pattern + Drone Attacks Equals an Oil Price Spike

The price of WTI crude oil spiked at the open on Monday, following drone attacks on Saudi Arabian oil facilities over the weekend that practically cut the kingdom’s output in half. How long will it take for output to be restored and is the situation going to escalate from here remains to be seen. The…

Read More »

Crude Oil Bears Needed a Spark. Trump Threw a Bomb

The price of crude oil recorded its biggest daily decline in four years Thursday after President Trump threatened to impose new tariffs on $300 billion worth of Chinese goods. The U.S.-China trade war has been unfolding during most of Trump’s presidency. With the 2020 elections approaching, many thought a trade deal might be in the…

Read More »

Crude Oil Bears Needed a Week… And Mike Pompeo

The price of crude oil has been marching upward since early June, when it bottomed at $50.59. By July 11th, a barrel cost $60.91. Unfortunately for the bulls, the rally came to a halt after Secretary of State Mike Pompeo stated Iran was willing to negotiate on its ballistic missile program. To the oil market,…

Read More »

Elliott Wave Setup Helps Crude Add 8.4% in a Week

The price of crude oil is approaching the $61 mark helped by U.S.-Iran tensions and a 9.5-million barrel decrease in US inventories. A rally in oil prices might seem easy to explain now, but it wasn’t so obvious a week ago. On July 3rd, crude was barely holding above $56 a barrel after a decline…

Read More »

Crude Oil Shows Why Alternative Counts Matter

Trade war fears are officially back, causing indiscriminate selling of stocks and commodities alike. Crude oil has been hit especially hard as supply glut worries are also beginning to reemerge. Crude oil closed at $53.34 a barrel last week, but this selloff was triggered by the breach of a key level in the week before…

Read More »

Crude Oil Made an Elliott Wave “Push-Up” Last Week

It has been an eventful week for crude oil traders. On Wednesday, January 16th, the EIA revealed that inventories have decreased by 2.7 million barrels from the previous week. In the same time, it became clear that U.S. oil production rose to a record high of 11.9 million barrels per day. The first piece of…

Read More »

More analyses