SINGAPORE: US oil is expected to fall to $90.13 per barrel, as a wave c from $85.73 may have completed.
This is the presumed third wave of an irregular flat from the Aug. 5 low of $87.01. It failed twice overcome a barrier at $95.67.
The failures, along with the deep fall on Thursday, have eliminated the chance of this wave to extend towards $97.26.
Even if this wave unexpectedly extends at a later stage, the extension may not occur until oil falls to $87.04.
A break above $93.77 may lead to a gain into $95.06-$95.67 range.
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On the daily chart, a bearish engulfing pattern around a resistance at $94.98 confirms not only a failure of the contract to break this resistance, but also a reversal of the short-lived uptrend from $85.73.
It is almost certain that oil would test the support at $91.22, a break below which could open the way towards $86.11.
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