SINGAPORE: US oil may break support at $84.21 per barrel and fall further towards $81.68 as its consolidation above this support seems to be ending.
Support has formed around the 61.8 percent Fibonacci projection level of a downward wave C, the third wave of a three-wave cycle that developed from the June 20 high of $107.73.
The rebound triggered by support failed to extend above resistance at $86.25, the 50 percent level, indicating a prevailing bearish market sentiment and an intact downtrend.
Strategically, the break below $84.21 will be confirmed when oil drops to its Oct. 10 low of $83.59. A break above $86.25 will open the way towards $88.29, the 38.2 percent level.
The views expressed are his own.
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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