The current structure suggests that we are in the final part of a cycle degree zigzag d, which is part of a larger degree triangle. Wave d consists of primary waves Ⓐ, Ⓑ, and Ⓒ.
With waves Ⓐ and Ⓑ fully completed and Ⓒ halfway through its final leg, we could expect the last move of the zigzag to end a little lower.
Since wave Ⓐ was an impulse, wave Ⓒ will be completed in a similar 5-wave pattern too, namely (1)-(2)-(3)-(4)-(5).
Wave (5) is the only incomplete wave of the intermediate degree pattern. Bears could take the oil prices near 47.79, as part of the 5-wave minor move to the downside.
The target would respect the tenancy of impulse wave (3) and (5) being equal.
However, a bird’s eye view suggests that wave d could have actually ended already at the intraday swing low.
This alternative scenario sees an erratic ratio relationship between intermediate waves (3) and (5) and places the latter on a false-break structure just a tad below wave (3). It could still, however, weaken slightly, should minor wave 5 turns into an ending triangle.
At the time of writing, it is difficult to project what effect a bullish alternative would have on the prices.
If a reversal proves successful, it can be argued that prices are likely to rise above the 56-58 area. If we see a test at wave (1)’s swing, then this will most likely turn into a corrective bullish attempt and continue lower in the longer term.
