Crude has entered into Supply Zone
This morning I want you to zoom-out to a daily chart to see a bigger picture in Crude Oil. My count suggests that the Feb 2016 bottom was a bottom of wave ( 3 ) down and an ( A ) – ( B ) – ( C ) pullback that followed was a completed corrective wave ( 4 ) up. Off the top of the wave ( 4 ) up we should see the final wave ( 5 ) down structured as ( A ) down – ( B ) up and the final ( C ) down targeting new lower low UNDER the Feb 2016 low.
The drop off the top made by the corrective wave ( 4 ) up in October 2018 – December 2018 from $78.24 to $43.29 clearly has an impulsive structure. There could be little doubt that it was wave ( A ) of ( 5 ) down. Off Dec 2018 bottom we should get a corrective wave ( B ) up. As long as this rally stays under $78,24, the top made in October 2018 by the wave ( 4 ) up this bearish count is valid.
Finally, because the structure of that rally off Dec 2018 has a bit unclear structure there are two potential scenarios. One is bearish and implies that this rally is the whole corrective wave ( B ) up. Another implies that this rally is only the first leg in wave A of ( B ) up. In both cases we should expect the price to get rejected by that Supply Zone and start a move down.