Elliott Wave 5.0 "Reboot"

Wednesday, April 20, 2016

WTI Crude Oil Intraday Review: Keep On Trucking!



The WTI bull market keeps on pushing higher, totally ignoring all the BS (bearish sentiment)  of the past several months. World oil glut? What world oil glut? Supply destruction has been going on with more to come and the inability or unwillingness of many nations to increase production. 
Many crude oil carriers are going around the tip of Africa as it is cheaper to burn fuel than pay the fees going through the Suez Canal. 

We can see how far fundamentals have been lagging the oil price. Since I have no bullish sentiment report,  I rely on the gold/oil ratio to help give us a clue if oil is being overbought. The ratio stands at just a bit over 29:1 which is still very cheap when compared to gold. Once we hit 20:1 or less, then we should wake up and start looking  for a substantial correction.

Right now WTI oil has the most bullish wave count I can find,  but we have to see if it can be maintained. After all, the summer season will be here soon and then the demand picture can change dramatically. 

My "D" wave bottom in Intermediate degree is still in force. What we had from the 2008 peak was one mother big zigzag crash which some are calling a mythical "X" wave. Any use of WXYZ waves is like telling the readers I have no clue where I am and I don't know if it is a flat or a zigzag. 

Using WXYZ waves hide patterns more than they ever help and this is the major reason why I have never used WXYZ waves. I have made it pretty clear my disdain for the use of WXYZ waves as the EWP needs to be simplified and not made more complex like in the little blue book. 

 My version of  EWP is all based on wave two as the base wave count,  not the 4th wave as a base wave count. This is drawn in detail with an idealized 1-2, 1-2, 1-2 and 1-2, base wave counts.
It is only the commodities that may see 5th wave extensions, but with stocks we should always look for the wave 3 to be the longest wave structure.  

Since crude oil basically was born in 1859,  there may only be one big 5 waves in SC degree before it runs out,  or nobody cares anymore. Electric cars will still take decades to make an impact on oil as they need to generate some serious amounts of electricity to run all these new electric cars.