The rally in Oil (CL_F) from October 3 low ($50.99) looks overlapping and corrective. This suggests the current rally is likely not a new bullish cycle. The structure of the rally is unfolding as a double three Elliott Wave structure. Up from October 3 low, wave ((w)) as shown on the chart below ended at $56.92. The pullback in wave ((x)) ended at 53.71 with the internal of a double zigzag. Oil then resumes higher again within wave ((y)). Internal of wave ((y)) is unfolding as a zigzag where wave (a) ended at $57.85 as a 5 waves impulse.
Wave (b) of ((y)) is in progress as a symmetrical triangle where further sideways consolidation is expected. As far as Oil remains above 55.78, it has scope to extend higher again in wave (c) of ((y)). Possible target for wave (c) of ((y)) higher is $59.57 – $63.19, which is the 100% Fibonacci extension from October 3 low. Once Oil reaches this area, cycle from October 3 low should end. It should then see sellers for more downside or a larger 3 waves pullback to correct cycle from October 3.
