Crude Oil Flashback Update: Triangle Breakdown Confirms Bearish Wave C Scenario As Key Resistance Approaches

Back on June 12, we discussed the potential for further weakness in crude oil as price was developing an A-B-C-D-E triangle pattern within wave B. At that time, we were watching for a decisive breakout from the multi-month range, with a break below the lower triangle support line expected to trigger a stronger move lower.

That scenario has now started to play out. Crude oil broke below the lower triangle boundary and accelerated to the downside, confirming the bearish structure we have been tracking over the last two to three months.

We should continue to watch for more weakness within a higher-degree wave C decline. So far, crude has already retraced into the March gap area, where new stabilization and a potential short-term recovery attempt have developed.

However, the current bounce may only be corrective. Ideally, crude is now forming a wave four recovery into the key resistance zone around $80, while the open gap near $85 remains another important upside level to monitor. This area could provide a new opportunity for sellers to step back in and resume the broader bearish trend.

The bearish outlook would be invalidated if crude manages to reclaim the $88.60 level, as a move back above this resistance would suggest a stronger recovery and challenge the current wave structure.