Whooph Trades - Oil

Seeing Market Waves = Income

Why crude oil? Because Oil led the market down dropping hints or market “tells” an entire THREE weeks before the COVID market crash. It pays to stay abreast of this commodity. Now, what’s she doing?

Whooph is currently in an Oil trade, but the purpose of this week’s brief is to explain the value of market waves. I don’t know how to stress this enough: I never fully got buy/sell signals consistently right until I grasped market waves.

In fact, I didn’t make consistent income until I understood that markets move consistently in Elliott Wave patterns. Call it Human Psychology for trade decisions in Large Numbers that causes the Wave phenomena. I don’t know. Best of luck disproving Elliott Wave! I’ve analyzed 40,000 charts in 25 years trading daily; I failed to disprove the theory. Call it Law.

Parsing waves via Price only will give ya headache. Instead I recommend using the MACD histogram highs and lows, exhibited in the example below, to count waves.

Elliott Waves 1-5 are present in 99% of trends and corrections in all timeframes.

In the Weekly chart below, Oil completes a downtrend. A trend terminates on Wave 5 or Elliott Wave (EW5). My chart cuts off EW1 and EW2 and shows only EW3, EW4, and EW5. This is to focus on what follows.

Following EW5 of the primary downtrend, swing traders know to expect Correction. Corrections typically consist of THREE waves A, B, and C. I say “typically” because sometimes a market collectively doesn’t know which is the primary trend. So, the market will paint five waves 1-5.

So, the in-progress correction for Oil (UCO) below you’ll see corrective Wave A up to a price of 28, Wave B down to 22 and Wave C is yet to be painted!

Note: There is no guarantee Oil’s UCO will remain above 22, but with strong support there, it’s likely. I’ll place a STOP Order (automatic SELL) below the 22. I don’t like to use stops but sometimes it’s wise, especially if you’re carrying a larger position. Protect ya capital, right? I believe is Risk Management.

So, the likely next stop for Oil is Resistance for UCO at 31. And this will likely be the end of Correction at Elliott Wave point C.

Regardless, if Oil’s UCO reaches my target Wave C point of 31, that’s a 37% gain. Hey, not too shabby for an Ex-Navy squid. ☺️

Thanks for following along with me. All of my Whooph Trades posts feature a chart to guide investors and swing traders in the discipline of Whooph METHODS.

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*See Charlie Whooph’s full Disclaimer.

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