SINGAPORE: US oil may test a resistance at $88.33 per barrel, a break above which could lead to a gain into $89.17-$90.01 range.
The contract has found a strong support around the Aug. 16 low of $85.73, which is strengthened by a similar one of $85.61, the 100% projection level of a downward wave c.
These supports triggered a pullback towards a rising trendline.
After three days' drop, market also needs to take a break and consolidate for one or few days.
A break below $85.61 could confirm the continuation of the wave c towards $83.93-$84.57 range.
US oil may revisit Aug 16 low of $85.73
On the daily chart, a projection analysis on the target of a wave C from $104.46 reveals a support at $85.59, which works together with the other two supports on the hourly chart to temporarily stop this wave.
Eventually, this wave C could overcome the barrier at $85.59 and extend towards $73.93.
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