Weekend Update Crude

CRUDE I wanted to start with the big picture first. I have adopted this view, as it is EWI's.

Based on this interpretation, the July 08 high completed a wave (V) of Supercycle degree. The ensuing decline down to the 32.40 L, that ended in December 08, completed an intermediate (A) wave.

We have been in the process of tracing out a (B) wave for all of 09. When (B) finishes, we should see 5 waves down of intermediate degree, which would complete (C), thus completing primary [2] (shown as circled on chart).

So, the big picture suggests that crude should go higher first, then significantly lower. I believe the downside target is around 10 (basis combined monthly)

This process should take a few years to play out. Long-term, if the interpretation is correct, should see crude at levels that are hard to imagine at this point.

Here is a look at the daily. I have ratcheted down my labels by one degree.

It appears that minute [b] has completed. Notice the break of the mid-line of the channel that had supported for a couple of days.

Price came within a whisker of the 23.6% retracement level of minor A. [c] = [a] at 57.39. The first little daily swing projects to 62.03, which is very close to the 38.2% retracement. All basis continuous contract.

Don't be surprised if they turn a triangle here. It has all the makings so far. My alternate is at the bottom.

Drilling down further we look at the 60m. I show v completing at the 71.80 H. That is the best I can come up with, however, it's possible that it ended up in that mess.

This would be a classic truncation if correct (p.35 Elliott Wave Principle). Regardless, it was a very unsatisfactory top IMO.

We took out the wave i H of 67.79 on a close, which is denoted by the dotted red line. We also appear to be impulsing down.

Although you can't tell from this 60m chart, I believe we are tracing a [4]th wave, maybe even a triangle, of most likely micro degree. This should be evident on any smaller trading chart.

The first objective will be to break the channel line. This should come into play around the mid 66's. The 261.8% of i sits at just under 66.

Short-term, RSI is oversold. I suspect we will finish up this first impulse fairly soon with a retracement coming sometime Monday.

Edit: failed to mention that Monday should be a cycle peak day (KoolsTools). This comes from the 7/13 and 7/29 lows. Friday also gave us a small cycle low day. There are several confluences pointing to an up day for crude Monday.

As always, follow the price action and structure firstly.