USOIL (WTI), Possible Flat

Trader_3rd Updated   
BLACKBULL:WTI   West Texas Intermediate Crude Oil cash
Daily Technical Outlook for oil
This is gonna be a pattern study based on elliott wave theory,
So What Is Elliott Wave Theory?

The Elliott Wave Theory is a method of market analysis, based on the idea that the market forms the same types of patterns on a smaller timeframe (lesser degree) that it does on a longer timeframe (higher degree). These patterns provide clues as to what might happen next in the market. According to the theory, it does not depend on what timeframe you are analyzing; market movements follow the same types of patterns.

The theory was developed by Ralph Nelson Elliott in the 1930s and was popularized by Robert Prechter in the 1970s. It claims that crowd behavior produces patterns and trends we see in markets; wave pattern, as defined by Elliott, is the physical manifestation of mass psychology in our world. These patterns not only appear in markets but anywhere humans make decisions en masse. Examples might include housing prices, fashion trends or how many people choose to ride the subway each day.

The theory suggests that any major market move is a cyclical in nature, 5 cycles in the direction of the dominant trend and 3 against the trend.

The 5 waves are called Motive waves and the other 3 are Corrective.
1. Motive Waves:
Motive waves move in the direction of the main trend and consist of 5 waves that are labelled Wave 1, Wave 2, Wave 3, Wave 4 and Wave 5.

Wave 1, 2 and 3 move in the direction of the main direction whereas Wave 2 and 4 move in the opposite direction.

There are usually two types of Motive Waves- Impulse and Diagonal Waves.
2. Corrective Waves:
Waves that counter the main trend are known as corrective waves.

Corrective waves are more complex and time-consuming than motive waves. Correction patterns are made up of three waves and are labelled as A, B and C.

The three main types of corrective waves are Zig-Zag, Triangle Waves and Flats.

Today we have a possible flat on the chart above ,
First what is a flat ?

The flat is another three-wave correction in which the sub-waves are formed in a (3–3–5) structure which is labelled as an A-B-C structure.

In the flat structure, both Waves A and B are corrective and Wave C is motive having 5 sub-waves.
There are essentially 3 types of flat corrections: regular, expanded and running. However, the most common type is the expanded, while running is rare.

This pattern is known as the flat as it moves sideways.
And i think we have running flat on the chart above as you can see,

Running Flat Rules :
In a running flat, wave B stops beyond the start of wave A.
And wave C falls short of stopping near the end of wave A.

The difference between an expanded flat and a running flat is wave C terminates beyond the end of wave A.

After an impulse pattern, the market begins its correction in wave A. it then reverses and begins wave B. Finally, the market corrects one last time in wave C to the Wave A end or near. Then the market breaks into the next impulsive wave.

I hope you all find it helpful,
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