Oil – Weekly Analysis
Oil Weekly reads the tape with a neutral lens—candles, momentum, and structure across the daily to monthly frames. We’ll mark the flip levels, the supports that matter, the caps that must give, and the invalidations that separate a bounce from a trend change. Directional pressure is present, but the plan, with probabilities and criteria, is built for either path.
CANDLES
Following a bearish August close, oil declined through the first half of September. Friday’s close printed potentially bullish signals on the daily, 3D, and weekly frames, while the 10D and 15D reiterated bearish odds. There is a fair chance of a bounce—or at least an attempt—over the next 1–2 weeks, but the broader bias remains down. Oil stays bearish until a confirmed reversal appears—at minimum on the weekly frame, which requires a close above the prior week’s high. Any other outcome will be treated as bearish.
8/20 EMA Quarterly Cross
(from the Jul 18 analysis, refreshed chart)
The 8/20 EMA bearish cross on the quarterly chart is on track for confirmation at the end of September—and historically, this signal has been anything but mild. With only five previous occurrences, each led to major declines ranging from 36% to 70%, with an average drawdown of 53%. If history rhymes, the statistical target for this move falls within the marked rectangle, with the average pointing to around $33.
This suggests the bear market in oil may persist for another 1–2 years. Tough news for oil investors—but potentially a tailwind for broader economic stability.
ELLIOTT WAVES
Last Wave
No changes for the potential paths. A break below the April 2025 low would likely confirm the blue path’s intent. Let’s hope oil finds support in the red rectangle to avoid the misery.
Summary:
Across all timeframes beyond 10D, oil’s bias remains down. The short- and mid-term frames may allow for a bounce, but it will likely be limited. Candles, indicators, and wave structure, taken together, still point to continued downside. We treat any near-term strength as corrective unless it proves otherwise. A durable shift would require a confirmed weekly reversal; until then, expect a sequence of lower highs and lower lows with downside risk intact.
Happy Trading!
