TradingLounge WTI Crudeoil Elliott Wave Technical Analysis

WTI Elliott Wave Analysis

Function - Counter-trend for wave 2

Mode - Corrective

Structure - Impulse for wave a of 2

Position - Wave 3

Direction - Wave 3 is in play

Details - The count still shows a downward trend for wave 3, following the commodity's drop below 80.29. The outlook remains bearish, targeting a range of 75-76 at a minimum.

Recent Movements in WTI Crude Oil Market
The recent activity in the WTI Crude Oil market points to a continuation of the bearish trend initiated in April 2024. The commodity has been erasing the gains seen since June 2024, experiencing a decline of approximately 60%. This pattern indicates a potential reversal rather than a mere correction, suggesting that WTI may continue to drop. The long-term perspective also remains bearish, with the corrective decline from March 2022 expected to extend below the March 2023 low, potentially reaching the $50 range. The ongoing decline from early July 2024 fits within this long-term bearish framework, provided the resistance at 87.63 holds.

WTI Crude Oil Daily Chart Analysis

The daily chart reveals a corrective structure starting from March 2022, where WTI peaked near $131. The first phase of this corrective cycle concluded at $64.5 in March 2023, marking wave W (circled) of the primary degree. This was followed by a corrective wave X (circled), ending at $95 in September 2023. The third leg of the bearish cycle, wave Y (circled), then began. Within wave Y, waves (A) and (B) completed at 67.81 in December 2023 and 87.63 in April 2024, respectively. Wave (C) started from 87.63 and is expected to decline in a 5-wave structure. Waves 1 and 2 of (C) seem to have been completed, with the current decline marking wave 3 of (C). Projections suggest that wave 3 could reach $61 or lower before encountering significant support.

WTI Crude Oil H4 Chart Analysis

The H4 chart focuses on the sub-waves of wave 3. Currently, the price is in the third wave, wave iii (circled) of 3. This indicates that wave 3 still has significant potential to move lower. As a result, the market conditions favor sellers, who might consider taking positions during corrective bounces.

Summary
The Elliott Wave analysis for WTI Crude Oil suggests a continuation of the bearish trend. Key levels to monitor include support at $61 and resistance at 87.63. Both long-term and short-term analyses point to further declines, with wave 3 of (C) expected to reach $61 or lower. Traders should remain cautious and look for selling opportunities during corrective bounces. By keeping an eye on wave structures and key price levels, traders can better anticipate future movements in the WTI Crude Oil market and make informed decisions.

Technical Analyst: Sanmi Adeagbo

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