Sharp reversal to the upside on crude oil gives us an idea about a completed three wave correction in Wave B) or 2). If that is the case, then recent strong upward action is a sign of stronger prices to follow into Wave C) or 3). We could now expect a five wave move to develop in the mentioned wave to around the 66/68.00 zone. A decisive break above the 52.24 level would be a confirmation for higher prices to follow.
Now, we see price trading at the start of sub-Wave 2.
Crude oil, daily
On the updated 4-hour chart of crude oil we can see the higher degree impulsive Wave 1 completed at the 54.54 level, following recent sharp reversal which we interpreted as unfolding red Wave A) of a minimum three wave corrective reversal in the upcoming Wave 2. As such we believe two more waves will show up, Wave B) which is in motion and later Wave C) which could face a possible reversal near the region of the former Wave 4) at 50.6 level, where even Fibonacci ratios of 38.2 or 50 could act as reversals higher.
Crude oil, 4-hour