What if oil does rally higher, into this price trap? Fail now vs. fail somewhat later?

Some are suggesting that XLE and by extension the oil-based energy sector are about to fail at price resistance. It does look possible on the oil, $WTIC chart - my daily and monthly charts are below. But here's the thing - tempting as it is to see a double top, perhaps it can edge higher to just above $78. That's implied by the way it made a higher rally high, suggesting from an Elliott Wave standpoint that it may have more waves up to come (waves 3,4,5 of a wave c to complete a B wave). And, after all, wasn't it Goldman Sachs that targeted $80/85 as the target? On a day when GS itself broke to new rally highs, maybe we shouldn't discount oil's prospects! (I'm not even certain where I should say "LOL" after that!)

From a cycles perspective, oil remains in trouble. And what waits at just over $78 is the Fibonacci .382 retrace back to the peak above $147. Perhaps oil won't fail here, but travel to the Fibonacci level as to a magnet. Then, either $78 or around $91/92 (the 50% retrace) can be a good B wave level that sends oil back down again. The monthly Bollinger Band midline is another strong resistance level - and it's been dropping; getting around $81 and may be around $78 by the time $WTIC gets there (assuming it can and does).

Playing from the long side should still be done with good stop protection, given its technical weakness. The ADX-DMI indicator doesn't confirm uptrending but not downtrending either, and it's flicked up. So, if you're trying the short side, I hope you're using a stop to protect if it does follow through to the upside.

Big picture? Some may thing it still has a new wave up to go, to even higher new all-time highs. Maybe. I'm concerned it's still correcting from a very large wave V - that can make this just a B wave movement up midway in a very large zigzag; with another huge C-wave drop yet ahead. So if it doesn't fail now, it can fail later after achieving the 38.2% or 50% retracement. In either case, pointing down to much lower levels as part of the long-wave Kondratieff deflationary winter scenario.

Perhaps the dollar just needs to get down to a level like 73.54 first ... Will see!