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Crude oil has a nice bullish structure on a daily chart where we labeled the recent pullback down as wave four of a five wave rise from 26.00. We are quite confident that new highs will be seen very soon, so be aware of a rise towards $55 this month. In fact, that fifth wave up would also confirm a significant bullish turn on the bigger time frame charts, since we know that five wave structures show the direction of a trend.

Crude OIL, Daily

oil daily

On the lower time frame, Crude oil turned nicely down at the start of the month from 51.65 where the market completed an extended blue wave three, so our wave count suggests that the recent bearish structure with three legs is wave four. In fact, the decline from 50.52, labeled as wave C), already spiked beneath wave A) levels, so minimum requirements for a valid correction were met, thus a new bullish turn may already be happening now with a current rise back towards 49.20 region that can open room for more gains ahead. Ideally, the market will continue higher into wave five, above 51.65. Currently we could be in a correction in wave 2), which could make a reversal higher around 50.0 or 61.8 Fibonacci ratio.

Crude OIL, 4H

oil 4