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US OIL Elliott Wave Technical Analysis – 20th August, 2013

Last week’s analysis of US Oil expected some more upwards movement to end just above 108.76 but not above 108.92. Price moved higher and turned at 108.17, just 0.59 short of the target.

This week I expect an increase in downwards momentum for Oil.

Click on the charts below to enlarge.

US Oil Elliott Wave Chart Daily 2013

Within a cycle degree c wave downwards primary waves 1 and 2 are complete. Within primary wave 3 intermediate waves (1) and (2) are complete, with the start of intermediate wave (3) at 108.92.

There is a clear evening doji star candlestick pattern at the high of intermediate wave (2) indicating a trend change here.

At 55.09 intermediate wave (3) would reach 1.618 the length of intermediate wave (1).

Within intermediate wave (3) no second wave correction may move beyond the start of its first wave. This wave count is invalidated with movement above 108.92.

US Oil Elliott Wave Chart Hourly 2013

Minuette wave (ii) completed as a rare running flat; subminuette wave c is slightly (0.59 cents) truncated. The subdivisions all fit perfectly, particularly the most important check, that of subminuette wave b as a three wave structure. It is very difficult to see this movement as a five.

Subminuette wave c ended almost right on the upper edge of the parallel channel containing this running flat of minuette wave (ii).

Within the running flat of minuette wave (ii) subminuette wave c is 0.15 short of equality with subminuette wave a.

Ratios within subminuette wave c are: micro wave 3 has no Fibonacci ratio to micro wave 1, and micro wave 5 is 0.28 short of 1.618 the length of micro wave 1.

Micro wave 5 subdivides into an imperfect ending contracting diagonal, imperfect because the third wave within it is the longest. All the subwaves correctly subdivide into single zigzags.

If this wave count is correct we should see some increase in downwards momentum over the next week.

At 98.07 minuette wave (iii) would reach 1.618 the length of minuette wave (i). If price keeps falling through this first target, or if when it gets there the structure is incomplete, then the next target is at 91.83 where minuette wave (iii) would reach 2.618 the length of minuette wave (i).

Within minuette wave (iii) no second wave correction may move beyond the start. This wave count is invalidated with movement above 108.17.

US OIL Elliott Wave Technical Analysis – 13th August, 2013

Last week’s analysis expected downwards movement to a short term target at 98.66 or 92.42. Price did move lower to make a new low at 102.24 but then turned back upwards. Price remains below the invalidation point on the daily chart and the wave count remains valid.

Click on the charts below to enlarge.

US Oil Elliott Wave Chart Daily 2013

Within a cycle degree c wave downwards primary waves 1 and 2 are complete. Within primary wave 3 intermediate waves (1) and (2) are complete, with the start of intermediate wave (3) at 108.92.

There is a clear evening doji star candlestick pattern at the high of intermediate wave (2) indicating a trend change here.

At 55.09 intermediate wave (3) would reach 1.618 the length of intermediate wave (1).

Within intermediate wave (3) no second wave correction may move beyond the start of its first wave. This wave count is invalidated with movement above 108.92.

US Oil Elliott Wave Chart Hourly 2013

I have reanalysed the upwards movement labeled now subminuette wave a within minuette wave (ii) as a double zigzag. The previous analysis of a single zigzag here did not look right, with a very short A wave and a very long C wave with no Fibonacci ratio between them.

The downwards movement labeled here submineutte wave b fits best as a three wave zigzag. I cannot see a five wave structure in here. This is an indication that minuette wave (ii) may not be over and may be continuing as a flat correction. Within it subminuette wave c is an incomplete five wave impulse.

If subminuette wave c fails to end at or above 108.76 then the structure will be a running flat. It is likely that subminuette wave c will end a little above 108.76, or very close to it. There is no Fibonacci ratio between micro waves 3 and 1, with micro wave 3 longer by 0.60.

There is another possibility that minuette wave (ii) was over as a double zigzag at the high labeled subminuette wave a at 108.76, and movement from this point is a first and second wave of a leading diagonal for the start of minuette wave (iii). The expected direction and invalidation point is the same (I will not chart this option this week).

When we see price move below 104.35 then downwards movement may not be a fourth wave correction within subminuette wave c and so subminuette wave c and minuette wave (ii) must be over. At that stage I would expect that a third wave downwards is unfolding.

Minuette wave (ii) may not move beyond the start of minuette wave (i). This wave count is invalidated with movement above 108.92.

US OIL Elliott Wave Technical Analysis – 6th August, 2013

Last week’s analysis expected downwards movement for the week, with a second wave correction to come. The first wave was already over and the second wave unfolded as a very deep zigzag, ending just below the invalidation point on the daily chart. The hourly chart was invalidated.

The wave count remains mostly the same this week.

Click on the charts below to enlarge.

US Oil Elliott Wave Chart Daily 2013

Within a cycle degree c wave downwards primary waves 1 and 2 are complete. Within primary wave 3 intermediate waves (1) and (2) are complete, with the start of intermediate wave (3) at 108.92.

There is a clear evening doji star candlestick pattern at the high of intermediate wave (2) indicating a trend change here.

At 55.09 intermediate wave (3) would reach 1.618 the length of intermediate wave (1).

Within intermediate wave (3) no second wave correction may move beyond the start of its first wave. This wave count is invalidated with movement above 108.92.

US Oil Elliott Wave Chart Hourly 2013

The low at 102.68 was the end of a five wave impulse.

Ratios within minuette wave (i) are: subminuette wave iii has no Fibonacci ratio to subminuette wave i, and subminuette wave v is 0.20 short of 0.618 the length of subminuette wave iii.

Ratios within subminuette wave iii are: micro wave 3 is 0.11 longer than 1.618 the length of micro wave 1, and micro wave 5 is 0.11 short of equality with micro wave 1.

A parallel channel drawn about minuette wave (i) using Elliott’s first technique perfectly shows where subminuette wave iv found resistance. This impulse is textbook perfect. I wish I had seen it last week!

Minuette wave (ii) is a very deep sharp zigzag. Because there is no further room left for upwards movement if this wave count is correct then minuette wave (iii) must begin here. We should see an increase in downwards momentum over the next week for US Oil.

Minuette wave (ii) subdivides as a deep sharp zigzag with subminuette wave b an expanding triangle. There is no Fibonacci ratio between subminuette waves a and c.

Ratios within subminuette wave c of minuette wave (ii) zigzag are: micro wave 3 is 0.04 short of equality with micro wave 1, and micro wave 5 is just 0.02 longer than 0.382 the length of micro wave 1.

At 98.66 minuette wave (iii) would reach 1.618 the length of minuette wave (i). Because minuette wave (ii) was so deep it is also fairly likely that minuette wave (iii) may reach 2.618 the length of minuette wave (i) at 92.42. If price keeps dropping through the first target then the second target is the next likely end.

Minuette wave (ii) may not move beyond the start of minuette wave (i). This wave count is invalidated with movement above 108.92.

US OIL Elliott Wave Technical Analysis – 23rd July, 2013

Oil has moved higher as expected for the week, remaining just below the invalidation point. If price breaks above 110.56 in the next one to few weeks this wave count will change significantly. I will briefly cover the alternate for this scenario today.

Click on the charts below to enlarge.

US Oil Elliott Wave Chart Daily 2013

Intermediate wave (2) is most likely now a complete zigzag. There is a nice evening doji star candlestick pattern at the high of intermediate wave (2) indicating a trend change.

Within intermediate wave (2) minor wave C has no Fibonacci ratio to minor wave A.

Ratios within minor wave C are: minute wave iii has no Fibonacci ratio to minute wave i, and minute wave v is just 0.06 longer than 0.382 the length of minute wave i.

When the wide parallel channel containing intermediate wave (2) is breached then we shall have trend channel confirmation of this trend change.

Within intermediate wave (2) minor wave 2 may not move beyond the start of minor wave 1. This wave count is invalidated with movement above 108.92.

US Oil Elliott Wave Chart Hourly 2013

The structure within intermediate wave (2) may again be considered complete. Price did not move lower as expected to complete minute wave iv last week, it moved sideways to complete a triangle. Within the triangle on the five minute chart minuette wave (e) itself subdivides nicely into a contracting triangle.

There is perfect alternation between minute waves ii and iv; minute wave ii was a deep sharp zigzag, minute wave iv is a time consuming sideways moving shallow triangle.

The channel drawn about the impulse of minor wave C is now very clearly breached indicating intermediate wave (2) is probably over and intermediate wave (3) has likely just begun.

Ratios within minute wave v are: minuette wave (iii) is just 0.01 short of 2.618 the length of minuette wave (i), and minuette wave (v) is exactly 1.618 the length of minuette wave (i). With these remarkably good Fibonacci ratios I am confident this labeling of minute wave iv triangle and minute wave v impulse is correct.

Within the new downwards movement we do not have a clear five down. This movement so far does not subdivide into a leading diagonal because the first wave down labeled subminuette wave i itself subdivides into a diagonal on the five minute chart.

Within subminuette wave iii if micro wave 2 were to move higher it may not move beyond the start of micro wave 1. This wave count is invalidated at minute wave degree with movement above 108.58.

Alternate Monthly Wave Count.

US Oil Elliott Wave Chart Monthly Alternate 2013

If price moves above 110.56 in the next week this is the wave count I would use.

It is possible that cycle wave b is not over and is completing a double zigzag, with primary wave X within it a contracting triangle.

The triangle of primary wave X does fit, in that all the waves within it can be seen as threes, but it does not have a very typical look for a contracting triangle. The overshoot of the B-D trend line within intermediate wave (E) looks strange. For this reason I would judge this wave count to have a low probability. I would only consider it seriously if it was confirmed with price movement above 110.56.

If this wave count is confirmed we should expect a continuation of upwards movement from oil for some months yet. There is not normally a Fibonacci ratio between subwaves W and Y within doubles, and so a target for primary wave Y to end could only be calculated when intermediate waves (A) and (B) within it are complete.

Cycle wave b may not move beyond the start of cycle wave a. This wave count is invalidated with movement above 146.73.

US OIL Elliott Wave Technical Analysis – 16th July, 2013

Last week’s analysis expected more upwards movement to a short term target at 105.57 to 105.60. Price has reached up to 107.46, 1.86 above the small target zone, before turning lower and breaching the small parallel channel drawn on last week’s hourly chart indicating a short term trend change.

Click on the charts below to enlarge.

US Oil Elliott Wave Chart Daily 2013

Intermediate wave (2) is an incomplete zigzag. Within it minor wave B was a triangle and minor wave C is unfolding as an impulse which is incomplete.

Within the impulse of minor wave C minute waves i, ii and now iii are complete. Minute wave ii was a very deep 82% zigzag correction. Given the guideline of alternation I will expect minute wave iv to be a relatively shallow flat, triangle or combination.

There is no adequate Fibonacci ratio between minute waves iii and i. I will expect to see a Fibonacci ratio between minute wave v and either of iii or i.

Minute wave iv may not move into minute wave i price territory. This wave count is invalidated with movement below 99.21.

We may now use Elliott’s channeling technique to draw a channel about minor wave C. Draw the first trend line from the highs labeled minute waves i to iii, place a parallel copy upon the low of minute wave ii. Expect minute wave iv to find support at the lower edge of this channel.

Intermediate wave (2) may not move beyond the start of intermediate wave (1). This wave count is invalidated with movement above 110.56.

US Oil Elliott Wave Chart Hourly 2013

Minute wave iv looks incomplete so far. It looks like it is unfolding as a shallow regular flat correction.

Within minute wave iv minuette wave (a) subdivides nicely as a zigzag. Minuette wave (b) is a complete double zigzag and is a 91% correction of minuette wave (a) meeting the mininum requirement of 90% for a flat and indicating a regular flat may be unfolding.

This wave count expects a five wave structure downwards to complete for minuette wave (c) which may find support at the lower edge of the parallel channel containing minute wave iv. This may end about the 0.236 Fibonacci ratio of minute wave iii at 103.72.

At 104.03 minuette wave (c) would reach equality in length with minuette wave (a).

This gives us a small 0.31 cent target zone for the end of a little more downwards movement.

If minuette wave (c) continues lower through this target zone and below the small parallel channel containing the flat correction of minute wave iv then expect downwards movement to find support at the lower edge of the parallel channel drawn on the daily chart.

When minute wave iv is complete then we should expect more upwards movement most likely to new highs above 107.38 as the final fifth wave upwards completes.

US OIL Elliott Wave Technical Analysis – 9th July, 2013

Last week’s analysis published charts only.

Last week I expected the structure for a third wave upwards was incomplete. The short term target on the hourly chart was 105.52. Price has reached up so far to 0.76 short of the target.

Click on the charts below to enlarge.

US Oil Elliott Wave Chart Daily 2013

This daily chart follows on directly from last week’s analysis.

Intermediate wave (2) is an incomplete zigzag. Within it minor wave B was a triangle and minor wave C is unfolding as an impulse which is incomplete.

Within the impulse of minor wave C minute waves i and ii are complete. Minute wave ii was a very deep 82% zigzag correction. Given the guideline of alternation I will expect minute wave iv to be a relatively shallow flat, triangle or combination.

At 105.57 minute wave iii would reach 1.618 the length of minute wave i. About this point I would expect upwards movement to stall for between three and five days. Minute wave iv should move price sideways. Minute wave iv may not move into minute wave i price territory. This wave count is invalidated with movement below 99.21.

Intermediate wave (2) may not move beyond the start of intermediate wave (1). This wave count is invalidated with movement above 110.56.

US Oil Elliott Wave Chart Hourly 2013

This hourly chart shows the entire structure within minute wave iii.

Within minute wave iii there is no Fibonacci ratio between minuette waves (i) and (iii). This makes it more likely we shall see a Fibonacci ratio between minuette wave (v) and either of (i) or (iii). At 105.60 minuette wave (v) would reach equality in length with minuette wave (iii). This gives us a 3 cent target zone for a little more upwards movement.

Ratios within minuette wave (iii) are: subminuette wave iii is 0.60 short of 1.618 the length of subminuette wave i, and subminuette wave v has no Fibonacci ratio to either of subminuette wave waves i or iii.

When minute wave iii is complete we should expect a short term trend change and some sideways movement for minute wave iv. Minute wave iv should breach the small best fit parallel channel containing minute wave iii, and this will be confirmation it has begun.

Minute wave iv may not move into minute wave i price territory. This wave count is invalidated with movement below 99.21.

US OIL Elliott Wave Technical Analysis – 25th June, 2013

Last analysis of US Oil was two weeks ago. It expected upwards movement to complete a second wave correction with a target at 98.36 and an invalidation point very close to that at 100.43.

Price moved higher as expected to reach 99.21, just 0.85 above the target, before turning strongly downwards.

The wave count remains the same.

Click on the charts below to enlarge.

US Oil Elliott Wave Chart Daily 2013

This wave count sees US Oil in a third wave downwards at intermediate degree, within a primary wave C down.

Within intermediate wave (3) minor waves 1 and now also 2 are both probably complete. The next movement downwards should be a strong third wave.

I have drawn a parallel channel about the second zigzag in the double of minor wave 2. When this channel is clearly breached with at least one full daily candlestick below it and not touching the lower trend line then we shall have trend channel confirmation of a trend change. At this stage we have an overshoot only, not a clear channel breach.

However, there is no room left for upwards movement for minor wave 2. Also, it is a double zigzag structure which is reasonably common and for it to continue further would see it unfold as a very rare triple. The probability that this correction is finally over is extremely high.

We should expect Oil to continue to fall with an increase of downwards momentum. In the next few weeks to months we may see some explosive downwards movement.

Minor wave 3 must move below the end of minor wave 1 at 84.07. At 72.74 minor wave 3 would reach 1.618 the length of minor wave 1. This target is weeks away.

When minute waves i through to iv within minor wave 3 are complete then the target calculation may be done at a second wave degree. The target of 84.07 may widen into a zone or it may change as there is more structure to analyse.

Within minor wave 3 no second wave correction may move beyond the start of its first wave. This wave count is invalidated with movement above 99.21.

US Oil Elliott Wave Chart Hourly 2013

So far within minute wave iii we may have the end of minuette wave (i) within minor wave i.

Ratios within minuette wave (i) are: there is no Fibonacci ratio between subminuette waves i and iii, and subminuette wave v is 0.07 short of 0.236 the length of subminuette wave i.

Ratios within subminuette wave iii are: micro wave 3 is 0.14 short of 1.618 the length of micro wave 1, and micro wave 5 is just 0.01 longer than 1.618 the length of subminuette wave i.

Ratios within micro wave 3 are: submicro wave (3) is 0.03 longer than 1.618 the length of micro wave 1, and micro wave 5 has no Fibonacci ratio to either of micro waves 1 or 3.

Within micro wave 4 submicro wave (C) is 0.01 longer than 2.618 the length of submicro wave (A).

Ratios within subminuette wave a of minuette wave (ii) are: micro wave 3 has no Fibonacci ratio to micro wave 1, and micro wave 5 is 0.13 short of 1.618 the length of micro wave 1.

At 96.82 subminuette wave c would reach 0.618 the length of subminuette wave a, and minuette wave (ii) would end just above the 0.618 Fibonacci ratio of minuette wave (i). If subminuette wave b moves lower the target at 96.82 must also move correspondingly lower.

While minuette wave (ii) is incomplete any further downwards movement of subminuette wave b may not move beyond the start of subminuette wave a at 92.71.

When we have upwards movement for subminuette wave c then this short term invalidation point will no longer apply.

We may expect subminuette wave c to find resistance at the upper edge of the channel drawn about minuette wave (ii).

This second wave correction should be over within 24 to 48 hours. I expect a trend change during the next week. The next movement downwards should see an increase in downwards momentum.

US OIL Elliott Wave Technical Analysis – 11th June, 2013

Last week’s analysis of Oil expected more upwards movement which is what has happened. The wave count remains the same.

Click on the charts below to enlarge.

US Oil Elliott Wave Chart Daily 2013

This wave count sees US Oil in a third wave downwards at intermediate degree, within a primary wave C down.

Within intermediate wave (3) minor wave 1 is complete and minor wave 2 may be an incomplete double zigzag. Within the double zigzag structure of minor wave 2 the first zigzag labeled minute wave w is complete, as is the three joining the two structures labeled minute wave x. Within minute wave y zigzag minuette wave (a) subdivides into a five wave impulse. Minuette wave (b) is a completed zigzag, and minuette wave (c) upwards is incomplete.

Minor wave 2 may not move beyond the start of minor wave 1. This wave count is invalidated with movement above 100.43.

US Oil Elliott Wave Chart Hourly 2013

Within the structure of minuette wave (c) subminuette waves i through to iv may be complete. Minuette wave (c) may be unfolding as an impulse.

Subminuette wave iii is just 0.04 short of 1.618 the length of subminuette wave i. At 96.49 subminuette wave v would reach equality in length with subminuette wave i.

At 98.36 minuette wave (c) would reach 0.618 the length of minuette wave (a) within the zigzag of minute wave y. This would bring minor wave 2 right up to the start of minor wave 1.

Draw a parallel channel about minuette wave (c). Draw the first trend line from the lows of subminuette waves ii to iv, then place a parallel copy upon the high of subminuette wave iii. Expect subminuette wave v to most likely end midway within this channel.

As soon as we can see another five wave structure upwards complete from the low of subminuette wave iv then it will be possible that subminuette wave v is complete. At that stage the short term invalidation point must be removed and we would expect a trend change.

Within subminuette wave v no second wave correction may move beyond its start. This wave count is invalidated with movement below 94.07.

If this wave count is invalidated with downwards movement then I would expect that this final fifth wave has come to an end and so minor wave 2 in its entirety may be over.

US OIL Elliott Wave Technical Analysis – 4th June, 2013

Last week’s main wave count expected downwards movement to complete a triangle, but not for price to move below 92.21.

We did see price move lower, but the triangle was invalidated. This has necessitated a reanalysis of the wave count.

I have just the one wave count for you this week; the previous alternate did not fit.

Click on the charts below to enlarge.

US Oil Elliott Wave Chart Daily 2013

This wave count sees US Oil in a third wave downwards at intermediate degree, within a primary wave C down.

Within intermediate wave (3) minor wave 1 is complete and minor wave 2 may be an incomplete double zigzag. Within the double zigzag structure of minor wave 2 the first zigzag labeled minute wave w is complete, as is the three joining the two structures labeled minute wave x. Within minute wave y zigzag minuette wave (a) subdivides into a five wave impulse. Minuette wave (b) is a completed zigzag, and minuette wave (c) upwards is incomplete.

Minor wave 2 may not move beyond the start of minor wave 1. This wave count is invalidated with movement above 100.43.

The previous alternate wave count saw minor wave 2 as over and minor wave 3 downwards as beginning with a leading diagonal in a first wave position. It had to see the piece of upwards movement labeled on the chart above as subminuette wave b within minuette wave (b) of minute wave y as a five wave structure. I have looked carefully at this piece of movement and I conclude it simply cannot be a five and it must be a three. For this reason I have discarded my alternate and have only this one wave count for you this week.

US Oil Elliott Wave Chart Hourly 2013

Instead of a triangle unfolding in a B wave position, the overlapping series of zigzags was an ending diagonal which trended lower.

Overall the wave count remains mostly the same.

Within minor wave 2 price is within the second of two zigzags, labeled minute wave y.

Within minute wave y zigzag minuette waves (a) and (b) are complete. Minuette wave (c) upwards is so far unfolding as an impulse.

Within minuette wave (c) subminuette waves i and ii are complete. Subminuette wave iii is unfolding upwards and so far is incomplete.

Within subminuette wave iii micro wave 2 may not move beyond the start of micro wave 1. This wave count is invalidated at subminuette wave degree on the hourly chart with movement below 92.38, prior to the completion of minuette wave (c).

When minuette wave (c) upwards is a completed five wave structure then the short term invalidation point is removed and we should expect a trend change with downwards movement.

At 98.36 minuette wave (c) would reach 0.618 the length of minuette wave (a) within the zigzag of minute wave y. This would bring minor wave 2 right up to the start of minor wave 1. Sometimes, this is what second waves do. When they do this they test our nerves to the extreme!

Minor wave 2 may not move beyond the start of minor wave 1. This wave count is invalidated with movement above 98.37.

If this wave count is invalidated with upwards movement it could be a continuation of intermediate wave (2) and the invalidation point would move up to the start of intermediate wave (1) at 110.56.