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The structure is becoming a little clearer. There is only one daily Elliott wave count this week.

Summary: The trend is down and corrections present an opportunity to join the trend. Currently, a little more upwards movement is indicated for another one or two days to about 37.7. The next target for a correction to interrupt this trend is at 30.05.

New updates to this analysis are in bold.

To see monthly charts go here.


US Oil Elliott Wave Chart Monthly 2014
Click chart to enlarge.

US Oil has been in a bear market since August 2013. While price remains below the upper edge of the maroon channel drawn here and below the 200 day simple moving average it must be accepted that the bear market most likely remains intact. I will not publish a bull wave count while this is the case and while there is no technical confirmation of a trend change from bear to bull.

The structure of cycle wave c is incomplete.

This wave count sees US Oil as within a big super cycle wave (II) zigzag. Cycle wave c is highly likely to move at least slightly below the end of cycle wave a at 32.70 to avoid a truncation. Cycle wave c may end when price touches the lower edge of the big teal channel about this zigzag.

Within cycle wave c, primary wave 5 is expected to be extended which is common for commodities.

No second wave correction may move beyond the start of its first wave above 50.93 within intermediate wave (3).

Draw a channel about this unfolding impulse downwards. Draw the first trend line from the highs labelled primary waves 2 and 4 then place a parallel copy on the end of primary wave 3. Next push up the upper trend line slightly to contain all of primary waves 3 and 4. Copy this channel over to the daily chart. The upper edge should provide resistance.


US Oil Elliott Wave Chart Daily 2014
Click chart to enlarge.

At 26.1 intermediate wave (3) would reach equality in length with intermediate wave (1).

Minor waves 1 and 2 are complete within intermediate wave (3).

Minor wave 3 is an incomplete impulse.

Minute waves i and ii are complete within minor wave 3. Minute wave iii would reach 1.618 the length of minute wave i at 30.05.

Draw a channel about this downwards movement. Draw the first trend line from the lows labelled minuette waves (i) to (iii), then place a parallel copy on the high labelled subminuette wave ii, so that all downwards movement is contained. Minuette wave (iv) may correct to about the 0.382 Fibonacci ratio at 37.70 and may find resistance at the upper edge of the channel.



US Oil Chart Daily 2015
Click chart to enlarge. Chart courtesy of

ADX still indicates a trend is in place, but as it is above 30 a correction from an extreme should be expected.

Monday’s upwards day comes with some increase in volume. The rise in price was supported by volume, so this is unlikely to be a short lived correction within the downwards trend.

RSI is oversold and shows some bullish divergence today with the low of yesterday. While price made a new low RSI did not. This indicates weakness in downwards movement from price.

Taken together these three indicators strongly suggest that Monday’s upwards day is not the end of this current upwards correction; some more upwards movement may be needed. This is why the Elliott wave count expects more upwards movement for a small fourth wave correction today.

In trying to find a trend line which may be used on On Balance Volume to assist to show when upwards movement is complete, I have moved the blue line. If OBV comes up to touch this line, it may be when upwards movement from price ends.

ATR agrees that a trend is in place as it too is rising overall.

This analysis is published about 10:19 p.m. EST.