SINGAPORE: US oil may test a support at $99.97 per barrel, with a good chance of breaking below this level and falling to $97.28.
The contract has fallen below a rising channel.
A duplicated lower channel suggests a target of $97.28.
The deep drop on Monday strongly indicates a completion of a three-wave cycle from $92.93.
The wave (b) ended around $95.44, which will be targeted once oil breaks $97.28.
US oil may fall into $105.14-$16.64 range
Immediate resistance is at $102.15, a break above which may lead to a gain limited to $104.33. On the daily chart, the current fall observes closely a set of projection levels on the downtrend from $116.64.
After falling below $102.52, oil is expected to test a lower support at $98.16.
It is critical that oil remains above $98.16 if it is to resume its uptrend from the April 11 low of $94.29.
A break below $98.16 may signal a continuation of the downtrend from the March 7 high of $130.50.
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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