Understanding the Current Elliott Wave Analysis in the Oil Market

The current Elliott Wave analysis in the oil market suggests that the cycle from the 4.12.2024 high is currently in progress as a 5-wave impulse Elliott Wave structure. This analysis provides valuable insights into the potential future movements of oil prices based on historical patterns and wave counts.

Breaking down the wave analysis further, we see that down from the 4.12.2024 high, wave (1) ended at 72.48, followed by a rally in wave (2) that concluded at 84.55. The subsequent wave (3) has seen the commodity turn lower, with internal subdivisions forming an additional impulse in a lesser degree. The journey from wave (2) includes wave (i) ending at 83.07, a rally in wave (ii) terminating at 83.45, wave (iii) extending towards 81.25, and wave (iv) coming to a close at 82.16. The final leg of the sequence, wave (v) ended at 80.81, completing wave ((i)) in a higher degree.

A notable recent movement in the market has been the unfolding of wave ((ii)) in an expanded flat structure. This involved wave (a) ending at 83.74, wave (b) lower ending at 80.22, and a rally in wave (c) wrapping up at 83.82, thereby completing wave ((ii)). Subsequently, oil turned lower in wave ((iii)), reaching a low of 76.40. Another significant phase in the market involved the construction of an expanded flat correction as wave ((iv)), finishing at a high of 78.60, before turning lower once more.

Looking ahead, the market has broken below wave ((iii)), signaling the end of wave ((v)) of 1 at 74.59 and the completion of wave 1 of (3). Following wave 1, the market experienced a zigzag correction, with wave 2 ending at 78.88 before embarking on wave 3 of (3) in a downward direction. After five swings lower, wave ((i)) of 3 found its conclusion at 71.67 low, with expectations of three swings higher to complete wave ((ii)) before resuming the downward trajectory. Thus, predictions suggest further downside movement to finalize wave ((iii)) of 3.

In the near term, the pivot at 78.88 high is viewed as a critical point. As long as this pivot remains intact, market participants anticipate any rallies to falter in 3, 7, or 11 swings, indicating a potential for continued downside pressure in the oil market. The short-term outlook remains cautiously bearish based on the current Elliott Wave analysis.