Oil: Hurst Cycles - 26th October 2022

A low of at least 40 day magnitude on 26th of September easily reaches our target of 85-90, prompting a rethink on the phasing of the 20 week nominal low. In this report we examine the new outlook

Tools required: Nominal Model | FLD | FLD Trading Strategy | FLD Trading Strategy (Advanced) | Principle of Nominality | Underlying Trend

Analysis Summary

The recent move up from the low on the 26th of September was proposed to be a trough of at least 40 day magnitude back in our last report into WTI crude. The strength of the move, which easily surpassed our target of 85-90 and found resistance at the 80 day FLD, has been considered too strong for a 40 day nominal low alone.

We noted in the last report that the 18 month FLD was likely to offer support, prior to price establishing a target to the downside for the 18 month nominal low, due late 2022:

From 27th September Report:

It is interesting to note that price is also sitting on the level of the 18 month FLD (yellow on long term chart). The target for the 18 month component trough would be significantly lower if price were to make the weekly cross here so a bounce may well be forthcoming.

The support, shown below on on the long term chart, helped push price to the 20 week and 80 day FLD resistance early October at around 93.