Elliott Wave 5.0 "Reboot"

Wednesday, February 17, 2016

WTI Crude Oil Rally Review

Another rally getting very close to an upside breakout. We know how markets can fool us so when the majority are waiting for the upside breakout, oil will just frustrate us and crash in price. 

Then when it does point down everybody becomes bearish as they run for the exits. As soon as the bears getting out is front page news the market will turn and soar travelling twice as far just to piss us off. 

Right now oil could do exactly that if it plunges to a new low well below the $29 price level. Crude oil just can't go to a new world record low. OPEC is arguing who is going to do what to whom or try and curtail production. It would take a miracle if they can work together at all. 

The mid east is at the brink of another potential war so they cannot halt oil production as they need to buy bombs with any oil income.  It would be nice to see a great looking crash low as that looks like a flat of some type as that would signal a strong leg up or 2 more legs up.

The link above talks about the gold/oil ratio with a nice long term chart. They use 17:1 as an average and I can work with that as well.