SINGAPORE: Signals look mixed for US oil as the sudden surge on Thursday has complicated the chart pattern.
Apparently, the surge was due to a support at $87.60, the 50 percent Fibonacci projection level of a downward wave C. It could be unusual that this wave has completed as it is much shorter than the wave A.
On the other hand, the strength of the surge signals a possible completion of the fall from the Sept. 14 high of $100.42, or at least a temporary completion.
The symmetrical nature of the chart pattern indicates the surge could be viewed as the right shoulder of a head-and-shoulders, so oil is still biased to retest $87.60.
No information in this analysis should be considered as being business, financial or legal advice. Each reader should consult his or her own professional or other advisers for business, financial or legal advice regarding the products mentioned in the analyses.
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