SINGAPORE: US oil is expected to test a support at $63.88 per barrel, a break below which could cause a fall to $62.62.
The contract failed to break a resistance at $65.45. The failure suggests a completion of a five-wave cycle from $57.25. This cycle has been driven by a bigger wave B, which will be reversed by a downward wave C.
A break above $65.45 may lead to a gain to $66.52.
The wave B seems to have developed within a rising wedge on the daily chart, which is a typical bearish continuation pattern.
Even if the uptrend from the November 2020 low of $33.64 has resumed, oil will have to face a strong resistance zone of $65.65-$66.60. The contract may start a correction as it did in February.
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