SINGAPORE: US oil may retest a resistance at $83.20 per barrel, driven by a wave c. This is the third wave of a presumed three-wave cycle from $73.60.
It is expected to travel above the peak of the wave “a” at $83.34, the Dec. 1 high.
A break above $82.30 could confirm the extension of this wave towards the $83.20-$84.52 range.
A failure to break $82.30 would make this wave count invalid. Key support is at $79.75, a break below which could signal the extension of the fall from $83.34 towards $77.62.
US oil may extend gains into $82.30-$83.20 range
On the daily chart, the shooting star on Dec. 1 and the black candlestick on Dec. 2 suggest the completion of the bounce from the Nov. 28 low of $73.60.
This bearish reading is contradicting that of the hourly chart.
However, oil’s stabilization around $80.62 seems to undermine the bearish outlook.
It is thus critical that oil closes above $80.62 on Monday.
A close below this level would suggest a fall towards $71.76-$77.24 this week.
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