SINGAPORE: US oil faces a resistance zone of $104.50-$104.99 per barrel, and may peak in it.
The zone has been formed by the April 16 high of $104.99 high and a resistance established by the upper trendline of a wedge.
Even though this pattern has a bullish indication due to its appearance after an uptrend, the chance of a break above $104.50 seems to be remote, as the bearish divergence on the hourly RSI strongly suggests an exhaustion of the current uptrend.
Only a break above $104.99 could confirm a bullish wedge and a target at $106.
A break below $103.52, the 76.4 percent Fibonacci retracement on the fall from the $104.99 to the May 1 low of $98.74 could signal a reversal of the uptrend.
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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