Again in February, I puzzled: “How Far Might Crude Oil Go?” As this commodity confirmed the upside reversal breaking above $54.6. We’re nonetheless residing in a “PetroWorld” due to this fact the worth of oil is essential, and it impacts all of us across the globe. So, we must always watch it rigorously.
I noticed a structural similarity on the weekly chart, which was cloned and utilized to the present pullback of oil worth on the decrease time-frame each day chart. The worth goal was set on the $63.7 and the time aim was set on the sixth of Could, 2019.
Earlier than we transfer on to the up to date each day chart, I want to present you the outcomes of your poll on this subject.
I can’t specific all my gratitude in your voting exercise and assist of my experiments. The ends in the diagram above present that you simply additionally noticed the realm above $60 as a goal for the present pullback. It’s but early to say if the worth has topped already, however our preliminary goal was achieved and even was handed over forward of time.
In one other poll, you voted for the devices you preferred essentially the most.
Right here once more, most of you supported me by selecting “All” devices possibility. Thanks, my buddies! The second runner was a basic Fibonacci retracement stage and its fairly pure reply as pullback means retracement.
Okay, let’s get right down to the up to date each day chart and see how worth moved in contrast again to again with the clone.
Chart courtesy of tradingview.com
The clone goal of $63.7 was hit one month sooner than predicted on the eighth of April, 2019 (orange vertical line). The very best level of the present pullback was established greater than $1 larger on the $64.eight the following day. Final Friday the worth drifted decrease to shut proper within the space of the preliminary goal.
Solely the primary leg of the clone (blue bars) until the mid of February seems related, after which the precise worth dynamics (orange bars) has made a spin-off to maneuver larger. An intermediate correction of precise oil worth has began later and was shorter than that, we will observe within the clone. The hole between the clone and the precise worth pattern continued until the start of this month as crude oil has made a pause in a minor consolidation and clone has accelerated its transfer as much as meet up with the true worth. Proper after that, the acceleration has exhausted and the precise worth of oil moved additional up after the quick break to make a brand new hole with a clone. That introduced us an early victory. The oil worth has gained greater than 16% for the reason that earlier submit was written. My congratulations to all of us!
The goal has been reached and what’s subsequent? Let’s see the up to date weekly chart, which was the mannequin for the clone to search out out if there’s any clue.
Chart courtesy of tradingview.com
It’s early but to evaluate if this upside transfer has been topped or not, however the present pullback achieved the minimal goal because it lastly retested the previous assist (purple trendline). And so did the blue CD phase, which is the same as the blue AB phase. It signifies that the second leg of the pullback additionally reached the minimal goal. Add right here that the worth retraced the usual 61.eight% Fibonacci stage and the image begins to change into worrisome for the bulls.
As we’re not guessing the tops let’s see the place we will set the triggers as soon as the worth begins to break down. The primary one is positioned on the $58.1 stage the place the sooner minor consolidation has bottomed. The idea is that the worth shouldn’t break the previous consolidation, however ought to proceed within the course of the principle pattern constructing the transfer up after every consolidation. When it breaks the latter one, then we must always see if there shall be a consolidation after a down transfer to substantiate the reversal.
The ultimate affirmation is positioned on the backside of the present transfer up at $42.four. The factor is that we already noticed the complicated corrections and the present transfer up may simply be the primary leg of extra sophisticated pullback. The worth may retest the present high yet another time however ought to tag the previous backside of $42.40 first.
Finally the drop ought to retest the previous backside of $26.1 to finish the construction.
Please go away your feedback under sharing your ideas concerning the oil worth future.
INO.com Contributor, Metals
Disclosure: This contributor has no positions in any shares talked about on this article. This text is the opinion of the contributor themselves. The above is a matter of opinion supplied for basic info functions solely and isn’t meant as funding recommendation. This contributor just isn’t receiving compensation (aside from from INO.com) for his or her opinion.