Oil finally fell so here are chart-based targets for what's next in $WTIC

Almost one month after I posted a warning that crude oil was topping over $107 ($WTIC), it finally dropped smartly. Meantime it had turned choppy but managed to reach almost $115 in $WTIC first. Goldman Sachs even issued a warning about the same time I'd done so - warning that it would underperform for a long time. For a few weeks, oil chopped higher and closer to targets mentioned by Andre Gratian as well as by Tony Caldaro (in update posts we've shared on this site). After today's plunge, I'm guessing a lot of people will finally see it as Goldman Sachs described - in a trough for awhile. Here's what I said about what pullback targets would be likely, in my post, Crude oil hits near-term target $111; how to trade it now, on April 8:

In my own (Ariel) opinion, a pullback target of $83 is possible for $WTIC based on the Fibonacci pattern indicated in my monthly chart, below, since it's testing around the $107-ish level that's a 61.8% retrace to the previous "all-time" high. But, that pullback of whatever amount (could also be to $95 or $90 areas) will be the next great buy before it marches toward Tony's $175 target!

Now that oil wrestled higher to almost $115 first, I'll focus more on the levels $90 to $96, with a lower level less likely but still possible about $85.

Traders should consider that lower oil - and thus gasoline - prices are likely to be a bullish factor for stock markets. So we shouldn't feel bearish overall about the effects of the oil drop. First, let's look at current $WTIC charts. Below are Tony Caldaro's daily and weekly charts of oil ($WTIC, from his public charts at his site (see his site address and feeds at right - thanks again Tony!)):

I respect Tony's apparent view that oil still has a fifth wave target up higher at $175 in $WTIC. And a 4th wave target to finish first, could happen around $90 to $96, which isn't really far away now. Might that fifth wave begin immediately? That seems unlikely to me. It's more common after a huge drop for some followthrough and consolidation to clear the way first. I'm going to show my daily and monthly charts of $WTIC below. Based on the Bollinger Bands, the 200-day moving average and other moving averages, and Fibonacci retracements, the most likely projections appear to be within the range $85 to $96, including good support at $90.

It may well take some time - days and weeks, even months - for oil to work out the low. I say that based on Fibonacci patterns since this looks like a "Gartley" pattern on the monthly chart. Sure, I know that on an Elliott Wave basis, the price could recover faster if there's still a fifth wave higher. But we'll have to hear from Tony in one of his updates. I can see the potential for an ending diagonal triangle to have occurred, but there are other ways to view the chart pattern, so I'll defer to Tony's view of the wave count.

If the oil price quickly tests the levels I've described over coming days - such as $96, $90 or $85 - then I'll be more open to a faster recovery in the upward trajectory. That might happen if it's a drop off a diagonal that returns to where that diagonal started, but then gives way to another big wave up. But if it staggers back up first, then I'll look for a lower high to sell (short) because it'll be vulnerable to seeking these lower levels. Either way, I'll expect the area $104 - $105 (and ($107 at most) to represent strong resistance.

And in the future, it'll take a strong move above $105 in $WTIC to re-position oil for the next bullish wave up toward the tests of $150 and $175. It's even quite possible that many large swing (and KI$$) traders and investors won't get seriously long oil again until $105 becomes support again. Because if it cannot mount $105, then something more bearish (like a large B wave giving way to a C wave drop) could be happening. But for now, we'll stick with the overall bullish view of oil and expect that $105 will eventually move from being resistance to support, when the time is right.