oil sell Current Assumed Position: The market appears to be completing a 4th wave correction (as a Zig-Zag pattern) within a larger impulsive trend.
Wave A (Down): Complete.
Wave B (Up): Complete. This was the counter-trend bounce.
Wave C (Down): Currently in progress. This is the final leg of the corrective pattern.
Key Guidance on the Length of Wave C:
Elliott Wave theory provides two primary guidelines for estimating the length of a C wave within a Zig-Zag:
Most Common Relationship: Wave C is often equal in length to Wave A.
This is the standard first target. Measure the price length (not time) of Wave A and project that same distance downward from the peak of Wave B.
Common Alternative: Wave C frequently extends to a length of 1.618 times the length of Wave A.
This is a very typical target if the underlying trend is strong and the C wave becomes powerful. This would be your second, deeper target.
What this means for your analysis:
Calculate the price difference (High - Low) of Wave A.
Subtract that value from the high of Wave B to find your primary target for the end of Wave C.
For a more bearish scenario, take the length of Wave A x 1.618 and subtract that from Wave B's high to find a secondary target.
Important Consideration:
Wave C must subdivide into a full 5-wave impulse itself. It cannot be a simple three-wave move. Monitor the internal structure of this decline to confirm it is developing as a 5-wave pattern, which will add confidence to this projection.
In summary: The most probable minimum length for Wave C is a decline equal to Wave A. Be prepared for a move extending to the 1.618 Fibonacci extension of Wave A.
