An explanation on the Crude Oil’s quarterly-chart, since 1983 :
” The essential underlying tendency of the wave principle is that action in the same direction as the one larger trend develops in five waves, while reaction against the one larger trend develops in three waves, at all degrees of trend.”
In accordance with the concept of the Elliott Wave Principle :
On the quarterly-chart frame, Crude Oil completed an impulsive five-wave sequence up at 147.27 peak, in summer 2008. Since then, over the past 8 years Crude Oil is likely to correct in a three-waves sequence(or a variation) as a possible fourth-wave.
“Quite often, when a large correction begins with a simple structure as first wave, the following waves will stretch out into a more intricately subdivided corrective form to achieve a type of alternation.”
Accordingly, for the subsequents of the overall corrective sequence; it would suggest that, the sharp simple structure fall could be labeled as the wave A(circled), the simple rise could be wave (A) of a variation of the wave B(circled) which is likely in progress, and then wave C(circled) decline which would be yet more complex is ahead.
How far down can the ongoing Crude Oil’s bear market be expected to go?
” The primary guideline is that corrections, especially when they themselves are fourth waves, tend to register their maximum retracement within the span of travel of the previous fourth wave of one lesser degree, most commonly near the level of its terminus.”
Based on the guideline of the Elliott Wave Principle; In the coming years, Crude Oil tend to develop its following wave sequences on the down trend persistently, and it is expected ultimately retrace to the span of travel area of the preceding the possible triangle fourth-wave of one lesser degree, around the 19.40 area.