WTI Crude Oil's Flirt With $66 Was No Coincidence
EWM Interactive | Aug 12, 2018 06:37AM ET
WTI crude oil set an upbeat mood at the start of last week and managed to lift the price to $69.89 on Monday, August 6th. They could not keep the positive momentum for very long though, as the price quickly reversed to the south again. By Friday, August 10th, the bears had already dragged WTI crude oil prices to an intraday low of $66.12 a barrel.
The ongoing truncated wave 5 at $74.67. This meant that as long as the price stayed below the end of wave x) at $70.41, a new low in wave “c” of y) should be expected. But first, wave “b” up had to complete its three-wave structure. A week later, this is what WTI crude oil’s hourly chart looks like now:
Wave “b” rose to $69.89, but it did not endanger $70.41, so the negative outlook was still intact. Crude oil spent the rest of the week declining until it fell to a new low of $66.12 on Friday.
The U.S. and China have been imposing tariffs for months now and crude oil was not declining all the time – there have been recoveries, as well. Why use the trade war to explain this particular slump then? Such after-the-fact explanations for price swings is what leads people to the false conclusion that the markets are random and chaotic. The truth is that without the Elliott Wave principle, we would think so, too.
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