My long-term forecast for crude is bearish and calls for a decline into the low $30s over the next 18-24 months. The weekly chart shown is mildly supportive of this view even though the futures generated a bullish impulse leg in early June with a high at 53.02 that slightly exceeded a minor ‘external’ peak at 52.75 recorded the previous November. The retracement since then to an early August low of 39.06 is bearishly impulsive, meaning bulls and bears are in ‘dueling’ mode on the weekly chart. For the time being, I’d give the latter a small edge because of the downside penetration of the red line, a midpoint Hidden Pivot support at 43.58. The penetration was by a relatively small amount, 43 cents, but that’s sufficient nonetheless for us to presume the weakness will hit p2=40.68 before bulls can muster a decent bounce. Alternatively, it would take an upthrust touching 51.54 to put bulls firmly back in charge.
