Crude

Crude took one on the chin today losing 3.5%. Volume was above average, while range was $3.38.

In the weekend update I talked about a couple of scenarios that may be in play. Based on the continuous contract, I discussed a minute [b] wave combination where (w) and (x) were complete.

It appears that (x) is taking the form of a triangle, also discussed. If this assessment is correct, then there is a good chance that we finished the triangle today.

It would measure $8.02 and target 77.29 based on e ending at the 69.27 L.

It would be the running type, as b exceeds the price extreme of a (p. 50, figure 1-43 Elliott Wave Principle).

This is the November contract. Notice that the late August highs do not exceed the early August highs.

This gives the opportunity for the minute degree triangle that the continuous contract doesn't afford (see weekend update chart).

In each case, they both suggest that near-term price should break higher. This assumes that [e] or e have completed. This is not a certainty.

The minute degree scenario argues that minor B has completed as well as giving a much bigger target. It measures a healthy $14.45 and gives 83.72 as the target.

Correctives can be very tricky. They can fool you into labeling a triangle complete way to early, or simply interpreting the structure incorrectly. So, keep that in mind before sending your buddy VO a mail bomb in case this breaks lower in a totally different pattern :)

I believe the conservative play would be to buy/sell a break of the [d] or [c] leg.