SINGAPORE: U.S. oil may revisit its Feb. 26 low of $55.02 per barrel, as suggested by a projection analysis and a rising trendline.
The contract failed to break a resistance at $57.93, the 50 percent projection level of an upward wave C. The failure indicates a temporary completion of this wave or a reversal of the uptrend from $42.36.
A rising trendline points a target at $54.39, the 23.6 percent level. Even though it is not very clear why oil reacted to the level of $55.02, the gain from which looks like a pullback towards $56.34.
On the daily chart, a retracement analysis on a medium-term uptrend from $26.05 to $76.90 reveals a resistance at $57.48, the 38.2 percent level, which has caused the current fall.
Based on this retracement analysis, the rally from the Dec. 24, 2018 low of $42.36 could be over, and oil may first fall to $51.48, the nearest support. A break above $56.34 (hourly chart) may lead to a gain to $57.93.
* The analysis is based on delayed data, prediction may be affected. Charts are not available in reports received in email box through "Alert". To get charts, use the news code of TECH/C to retrieve the original reports.
** 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 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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