It is near impossible to following all the developments in the geopolitics and try to forecast the price of Oil but what does technical analysis suggest?
Elliott Waves break down:
The sharp fall in March is clearly a motive wave which is likely based on a double zig-zag
The correction that has been forming since then is clearly a triangle but this type is very tricky and more often than not confused a lot of traders
Looking at the symmetry of the overall correction it is more likely that exit from the tringle is to be triggered downwards
In the case of this scenario the next wave will also be in form of zigzags and retracing from 0.618 to 0.786 of wave X hence the target of $84 to $89
As mentioned earlier, if the triangles are very condensed and of high amplitude it is more difficult to predict their development. So let's see what happens next week and update the count as needed.
What are your thoughts about this scenario?
Please share your thoughts in the comments and like this idea if you would like to see more stocks analysed using Elliott Waves.
Thanks for sharing! My thoughts after the fact: false breakout of the triangle to pull bulls in. Your downside target will be achieved nonetheless in coming weeks. Your projection of the great rally on the upside is also echoed by great analyst Samantha LaDuc.
vitalalyt
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@tfinavia, thanks for your comment, as I mentioned triangles can be quite tricky to predict when there is a shape asymmetry. However, looking at the geopolitics and with the upcoming embargo on Russian oil it is very likely that there will be some sort of rally. Let's see how things develop next week. At the moment I think it's quite difficult to predict the next move. And I'm not familiar with Samantha LaDuc but will check her out, thanks
tfinavia
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@vitalalyt, Sure. However, the alternate analysis of XLE (energy) and that it's printing quadruple negative divergence on the weekly RSI can tell us the future move of the crude. To me, oil has been riding the upwave largely due to the geopolitics only. Otherwise it was having triple negative divergence on the weekly RSI last October.
vitalalyt
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@tfinavia, I think that's the beauty and complexity of oil, it's extremely speculative and sensitive to news, just like Dogecoin with only difference that it's not only Musk who can influence price movement;)