SINGAPORE: US oil may retest a resistance at $87.86 per barrel, a break above which could lead to a gain to $89.45.
The rise on Wednesday confirmed an extension of the uptrend, which is riding on a wave 5.
Based on the length of the wave 1, the wave 5 may travel to $93, close to the 261.8% projection level of $94.60.
This wave became weak around $87.86, but it is unlikely to complete around this level and become a failed fifth wave.
Oil is expected to stabilize around $86.38 and resume its uptrend.
A break below $86.38 may cause a fall into a range of $83.69-$85.29. On the daily chart, a powerful wave iii is unfolding towards $91.50-$93.82 range, as pointed by the upper trendline of an expanding wedge.
Oil climbed above a resistance at $86.30 again. It has a better chance of rising to $89.17 first.
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