Crude oil gave us a short bullish move before oil reversed and plunged to a new bearish low. Oil has completed 2 sets of zigzags and we need two more and maybe a third, which could turn into a flat.
Another $5-$6 drops would be nice and then oil would be ready for a wave 3-4 rally in Minor degree. These diagonal waves can make spectacular moves when there are no daily trading limits.
I would love to see another small 5 waves down in Minuette degree before another potential counter rally can kill the bears and send them running back into the forest!
They’ll be back and that should coincide with my 5th wave down in Minor degree.
The Gold/Oil ratio definitely got better but at 22.8:1, it’s still not enough to jump up and down about. I do have some WTI short positions and so far the trade is in the green.
All this can fall apart if the “B” wave in Intermediate degree is too far off base. It may take until November/December before this, “Run of Five” gets completed.
When the “B” wave disappears on this 90 min chart then the wave 2 in Minor degree will be the main position I’ll be counting from.
The problem is that any “E” wave bottom in Primary degree could be below the $26 price level which is about $30 away from today’s price low. For that to come true some serious extensions would have to help it otherwise oil could come to a grinding halt much earlier.
During this 90 min chart, we had a golden cross and then right back into a death cross. With the daily chart, it will not take long for the 50-day MA to slice through the 200-day MA.