SINGAPORE: US oil is poised to break a support at $75.45 per barrel and fall towards $74.09.
The bounce triggered by this support has been almost reversed. The reversal confirms a continuation of a wave C towards $74.09.
Once the contract clears the support at $75.45, it is highly likely to revisit the Feb. 6 low of $72.25. Resistance is at $76.97, a break above which could lead to a gain into $77.42-$78.25 range.
On the daily chart, oil broke a support at $77.24. The break opened the way towards $71.76. The sideways move on Tuesday is considered as a part of a pullback towards this former support.
Only if oil could stand firm above $77.24 on Wednesday would this bearish outlook be reviewed.
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Wang Tao is a Reuters market analyst for commodities and energy technicals. 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 their professional or other advisers for business, financial or legal advice regarding the products mentioned in the analyses.