SINGAPORE: US oil may retest a support at $72.76 per barrel, a break below which could open the way towards $71.30. The contract is riding on a wave c, which is supposed to travel to $71.30, as it has extended below its 61.8% projection level of $73.66.
The bounce triggered by the support is classified as a pullback towards a wedge, which has been confirmed as a bearish continuation pattern, suggesting a much lower target of $67.49.
Immediate resistance is at $75.11, a break above which could lead to a gain into $76.01-$76.57 range. On the daily chart, oil has pierced below a key support of $73.80 and fallen close to the next support of $71.76.
US oil may retest resistance at $77.13
The fall sends a convincing signal that bears have taken full control of the market. They are driving the price towards $62.89.
A confirmed bearish flag indicates a lower target of $57.
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