Oil May Reactrace Back To 102.20 – Elliott Wave Analysis

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Oil has extended it’s weakness through 105.50 support recently where we labeled termination point of wave 4. We know that when this level is breached the larger five wave pattern is finished and that direction has changed, in our case from bullish to bearish mode. As such, we think that sharp fall from 112 represents wave A, first leg of a three wave retracement in wave 4) that may reactrace even back to 102.20 with wave C. At the moment we still don’t know if wave B is done or no, but break of 106.45 support could cause acceleration lower. In such case trader could be interested in shorts for wave C, but keep in mind that we are tracking wave 4) from 112.20 which can also become a complex pattern, rather than a simple zig-zag.

OIL 4h Elliott Wave Analysis

Oil 4h Elliott Wave Analysis
Oil 4h Elliott Wave Analysis

OIL 1h Elliott Wave Analysis

Oil 1h Elliott Wave Analysis
Oil 1h Elliott Wave Analysis

On the Intraday Chart rally from 104.20 is only in three waves contained by parallel trend-lines which is indication for a corrective rally. As such, we suspect that market is forming a zig-zag in wave B that may stop around 109 level. Bearish waves are expected as long as 112.20 holds

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Gregor Horvat first made his name in Slovenia and has become world famous in the forex market since 2003. He is both a trader and a technical analyst who offers trading strategies on the Fibonacci and Elliot Wave principle. His main focus is on currency pairs, U.S. stock market, gold and oil. Gregor Horvat found the forex service offered on http://www.ew-forecast.com/. This website provides traders technical analysis, while putting emphasis on behavioral patterns. These are derived from the Elliott Wave Principle (EWP). Traders who are interested in the entry and exit positions, and he probability of the former and latter follow the EWP on a regular basis.