Crude Oil has been in a range from the mid $40’s to the mid $50’s for many months now. It makes for good trading, but all that is about to change. Crude should be carving out a top here. Whether that is a long term of short term top all depends on what happens in the next couple weeks.
Let’s take a look at the 3 pathways crude may take.
Pathway #1: Uber Bullish Pathway
First pathway is a corrective retrace into the $50.90 to $49.90 area followed by an impulsive rally to new swing highs. I give this pathway a 40% chance of materializing.
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Pathway #2: Bullish Pathway
Second pathway is a corrective retrace into the $42 to $44 area followed by a rally in the form of an ending diagonal to new swing highs. I give this pathway a 40% chance of materializing.
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Pathway #3: Bearish Pathway
Third and least probable outcome is an impulsive decline into the $42 to $44 area, followed by a corrective retrace, and finishing the impulsive decline to new all-time lows. I give this pathway a 20% chance of materializing.
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Disclosure: Flat Crude Oil as of Friday April 7, 2017 from the $47 level.
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