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If you hadn't noticed petrol prices are on the march again and if you haven't felt the pinch yet you will when petrol heads for $1.50/1.60/litre.
Take a look below at the ProfitSource Elliott wave formation and in particular the Fibonacci wave five projections for Brent crude:
click chart for more detail
You may well be aware that Fibonacci generally projects three levels. In my experience the first level is an almost a certainty and in this case that would be a crude price of US$74/barrel, which in itself is not enough to rock the markets. But the second level, which has also a high chance of being reached, is US$80/barrel, and that is more than likely to cause some ructions in world markets. Maybe enough to release the upward pressure on global equity markets.
But don’t get angry – get even. Buy into energy stocks. As with all buying, this is best done during retreats. So no need to rush out and buy tomorrow, especially as many oil stocks have already run hard. But we know markets always retreat.
The flip side is that crude oil prices will not stay at such lofty levels for long. So watch this space for the next turning point – which will be down.
Enjoy the ride!
Tom Scollon
Chief Analyst
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