Elliott Wave InternationalmyEWISocioniomics.Net
Home > Energy
Let's Talk About the July 6 Crude Oil Decline, Shall We?
EWI's Energy Specialty Service used Elliott wave analysis to foresee crude oil's downside potential BEFORE the fundamental du jour payrolls report.
By Nico Isaac
Fri, 06 Jul 2012 16:00:00 ET
Add to Facebook Add to Twitter Email to a friend Printer Friendly Get the RSS feed Add to more social media services
Get investable insights sent to your inbox at least once a week – for free. Challenge the way you think about investing with The EWI Independent. Privacy

Here is a simulated conversation between 2 crude oil marketgoers regarding the July 6 bearish price action:

Marketgoer 1, we'll call him "Mike": Holy Moly! Today's intraday action in crude oil saw prices plunge 2.8%-, 3.0%-, then 3.4% before the closing bell. What do you think caused the slide?
 
Marketgoer 2, we'll call her "Jane": Well, when the mainstream experts spun their "Wheel of Fundamentals," the needle landed firmly on one event: The July 6 US Labor Department report, which came in below expectations. Says this Wall Street Journal report:
 
"Crude tumbles after the US Labor Dept. released June nonfarm payrolls figures...It was a horrendous number. It's extremely bearish for oil prices."
 
Mike: But how can that be true? The payrolls report was released at 8:30 AM (EST). But if you look at the hourly price chart of crude oil below, you'd see that prices were moving down long BEFORE the report went public.
 
 
 
 
So, what really caused crude oil's July 6 decline?
 
Well, here's where EWI's Energy Specialty Service takes over the conversation. One day earlier, at 8:41 AM on July 5, Energy Specialty Service published the following intraday update and chart of crude oil:
 
"Crude's new rebound high meets the minimum upside expectations. I'm looking for a top (88.98?) and trade below Wednesday's 86.50 low should be a good hint it's in place." 
 
 
 
After hitting a high of 88.98 on July 5, crude oil prices turned the bearish corner we see today.
 
Stay ahead of the fast-moving "busses" in crude oil's near-term path. Subscribe to EWI's premier, trader-focused Energy Specialty Service today.

How Can You Tap into Energy Market Volatility?
 
 
Let EWI's most specialized forecasting service for global energy markets alert you to opportunities happening right now in crude oil, natural gas and other major energy markets. Subscribe today and get instant access to comprehensive intraday and daily forecasts that can help you make smarter trading decisions.
 

Tags: crude oil, Elliott wave, fundamental analysis, Wall Street
Rating: - based on [7 rating(s)]
Rate this content:
  
EWI's Event Calendar
May 13-16     

Las Vegas Money Show

July 10-13       

Freedom Fest Conference



Identify Your Next Opportunity in Oil Now

Energy Specialty ServiceTurn possibilities into probabilities with insight from EWI's Energy Specialty Service, a service designed to help you stay in front of the trend in Energy Futures.

Actionable forecasts across all timeframes help you anticipate and act on opportunities in oil, natural gas and other major energy markets.

Learn how you can put an Elliott wave expert to work for your trading>>
Free Video Course


Learn the Why, What and How of Elliott Wave Analysis

Financial media use news and economic events to explain market moves. Steer clear of this misguided approach. Take part in the Elliott Wave Crash Course to learn what really moves the markets.

Energy


The Elliott Wave Principle is a detailed description of how financial markets behave. The description reveals that mass psychology swings from pessimism to optimism and back in a natural sequence, creating specific Elliott wave patterns in price movements. Each pattern has implications regarding the position of the market within its overall progression, past, present and future. The purpose of Elliott Wave International’s market-oriented publications is to outline the progress of markets in terms of the Wave Principle and to educate interested parties in the successful application of the Wave Principle. While a course of conduct regarding investments can be formulated from such application of the Wave Principle, at no time will Elliott Wave International make specific recommendations for any specific person, and at no time may a reader, caller or viewer be justified in inferring that any such advice is intended. Investing carries risk of losses, and trading futures or options is especially risky because these instruments are highly leveraged, and traders can lose more than their initial margin funds. Information provided by Elliott Wave International is expressed in good faith, but it is not guaranteed. The market service that never makes mistakes does not exist. Long-term success trading or investing in the markets demands recognition of the fact that error and uncertainty are part of any effort to assess future probabilities. Please ask your broker or your advisor to explain all risks to you before making any trading and investing decisions.