Support has formed around the 61.8 percent Fibonacci projection level of a downward wave C, the third wave of a three-wave cycle that developed from the June 20 high of $107.73.
The rebound triggered by support failed to extend above resistance at $86.25, the 50 percent level, indicating a prevailing bearish market sentiment and an intact downtrend.
Strategically, the break below $84.21 will be confirmed when oil drops to its Oct. 10 low of $83.59. A break above $86.25 will open the way towards $88.29, the 38.2 percent level.
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