SINGAPORE: US oil looks neutral in a range of $83.76-$85.44 per barrel, and an escape could suggest a direction.
The contract is presumed to be riding on a wave C from $88.17, which could travel to $81.03.
However, it is not very clear if the preceding wave B from $82.09 has completed.
This wave may take the form of a flat pattern, consisting of three smaller waves that are roughly equal in length.
Oil ticks up in tight market but bearish signals remain
A break above $85.44 could confirm such a scenario.
A target zone of $86.50-$87.87 will be established accordingly.
A break below $83.76 may suggest the continuation of the wave C towards $81.03.
On the daily chart, oil is sandwiched between $83.17 and $87.44.
Trending signals will become clearer when the contract moves out of the range.
The current speculation is oil may remain the in range for one or two days before getting out of it.
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