Crude Oil Outlook

Crude oil has had a very nice run since the beginning of 2007. The question on everyone's mind is probably "how much higher can it go?" I believe it has yet to peak in the next several weeks. Below is a chart of USO:


From an Elliot Wave perspective, there needs to be one more high to complete the 5-wave bullish cycle from $42.56 (Crude Oil price is roughy 1.25*USO). I think that we will see this high within a couple months (especially since we are heading out of winter into higher demand).

However, following this new high, there should be a multi-month correction. Oftentimes, Wave4 holds as support in these corrections. Therefore, I doubt we shall see prices below $65 (Crude $80) in the next 3-4 months.