Chart of Gasoline says $5 per Gallon is Coming
Start trimming the fat in your budgets now… because later on in 2013 or 2014 we’ll see gasoline’s price push well past $4 per gallon and very likely hit $5. The 3-year chart of gasoline futures below will show us why this is likely to happen.
Gas’ Range Nears Completion
Gasoline’s price soared quickly from late 2010 through early 2011. Ever since then it’s been consolidating in a very wide range.
Elliotticians know that a sideways range tends to make five passes back and forth (called a-b-c-d-e waves by Elliotticians) between its borders of support (green region) and resistance (red region) before breaking out. On rare occasions, ranges can last longer than this.
Well, as you can see from the chart above, four of the passes are complete. We could see one last dip, either as it heads back into the range or as it hits its bottom. But after that, look out! Gas prices will very likely blow through the top of the range and begin the next phase of its long-term uptrend once again.
How far could it go? Well, I can tell you how far they tend to go… minimally. They tend to travel at least the depth of the range from its breakout point.
At the top of the range, gasoline futures may have only been $3.40 per gallon but by the time you add in the taxes and fees, it equates to $4 or more at the pump.
Since the width of its range is $1 per gallon, the breakout will most likely send gasoline futures from $3.40 up to at least $4.40 if not higher.
By the time taxes and fees are added in… you’ll see $5 gasoline at the pump in much of the nation.
So since we know that higher gas prices are likely coming in the future, we’d better prepare now. You can cut excess expenses in your budget or work more by getting another job or by working more hours.
But my preferred way to tackle the higher gas prices to come is to own solid oil stocks that will rise as gasoline’s price rises.
Have a nice day!
Editor, Commodity Trend Alert