Long Term Forecast for Crude Oil (WTI)

I can see two paths that WTI could take in the nearest term, and both of them are likely to start with a substantial decline.

Red path:
– The correction that started in 2008 completed in April 2020. Note that wave (C) stopped at exactly 0.618 below (A) where 1.0 is the length of (A). This particular ratio is mentioned by Frost&Prechter.
– Wave (1) is in progress and can reverse any time. Wave 1 of (1) is the longest and, in order to comply to EW rules, the current wave cannot extend beyond 67.34. The event would invalidate the counts.
– Wave (2) could retrace 0.236-0.618 or a bit deeper, $26 – minus $7. Don’t tell me that Oil cannot be negative!
– The shape of retrace is yet to be seen.
Blue path:
– Big assumption about possible truncated diagonal that would explain a very sharp and long drop in the very next wave.
– Wave (C) of (II) would take the price much deeper into a negative territory.
– The Red path better fits the complexity guidelines for the corrective waves.

I think the main catalyst between the Red and Blue paths would be the character of decline. If the next wave down evolves as a pure motive, the is a chance for Blue. A corrective wave would make me pick the Red path as main Operative. It should not take very long – perhaps just few weeks or months for Market to decide.


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