US OIL Elliott Wave Technical Analysis – 12th August, 2014

Downwards movement has continued as expected. The wave count remains the same.

Summary: The target remains at 74.53. This target may be 13 weeks away.

Click on charts to enlarge.

US Oil Elliott Wave Chart Monthly 2014

Upwards movement has hit the upper teal trend line. Since price bounced down from that trend line this provides some confidence in this main wave count.

The one thing which looks most certain in this wave count is cycle wave a downwards is a five wave impulse. This means cycle wave b may not move beyond the start of cycle wave a above 146.73. Cycle wave b should subdivide as a three wave structure and is labeled as a double zigzag, which should now be complete.

Within the double zigzag this wave count sees primary wave X as a regular contracting triangle, ending at 84.07 where intermediate wave (E) typically undershot the B-D trend line.

US Oil Elliott Wave Chart Daily 2014

It looks like the first five down within intermediate wave (3) is complete.

Ratios within minor wave 1 are: there is no Fibonacci ratio between minute waves iii and i, and minute wave v is 0.67 longer than 2.618 the length of minute wave i.

Within minor wave 1 minute wave ii is a deep 92% regular flat correction and minute wave iv is a more shallow 58% zigzag showing good alternation.

I have drawn a parallel channel about minor wave 1 using Elliott’s second technique: draw the first trend line from the ends of minute waves ii to iv, then place a parallel copy on the end of minute wave iii. When this pink channel is clearly breached by upwards movement that shall provide trend channel confirmation that minor wave 1 is over and minor wave 2 is underway.

At this early stage minor wave 2 is unconfirmed.

If minor wave 2 has begun here then it may end about the 0.618 Fibonacci ratio of minor wave 1 at 103.28.

Minor wave 2 may not move beyond the start of minor wave 1 above 107.67.

The target for intermediate wave (3) remains at 74.53 where it would reach 1.618 the length of intermediate wave (1). Intermediate wave (1) lasted 13 weeks and intermediate wave (2) lasted 28 weeks. I would expect intermediate wave (3) may last a Fibonacci 21 weeks. So far it is in its 8th week so it may continue for another 13 weeks.

8 thoughts on “US OIL Elliott Wave Technical Analysis – 12th August, 2014

  1. So I figure you’re talking about super cycle (II) on the monthly chart?

    It looks like cycle wave c will be time consuming. Cycle waves normally last from one to several years. This one looks like it will last several years, maybe 7 in total? So maybe another 5 – 6 years.

    When it’s done then yes, a huge super cycle wave (III) up should start.

  2. Lara, The low that oil hit in 2008 early 2009, is there a chance that was the bottom of wave 2 and we are already in wave 3 up. Any chance of that?

    1. No.

      Cycle a subdivides as a five best. So the correction is not over there.

      Price movement from that low most certainly does not look like a developing third wave. It looks like a typical correction, a B wave.

      1. Thanks! So what is the timeframe roughly in your opinion for when wave 2 will reach a bottom? Also my last question is, when wave 2 does bottom, does it usually skyrocket up to start wave 3 and come back up within months like in 2009, or will it linger down in the bottom area for few years before it makes its way back up?

        1. Hey Lara! it wont let me login to comment so i write as guest….just curious about your thoughts on question above.

  3. It was expected that oil will make correction and then moves lower to first Target of 95……But that is not what happened…Oil mover lower first when the oil is expected to make correction.

    Thanks

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