SINGAPORE: US oil may bounce to $48.48 per barrel, as it has stabilised around a support at $47.13.

The support is identified as the 176.4% projection level on an uptrend from $37.06. The drop from the Monday high of $49.83 could be the very early signal that the uptrend becomes exhausted.

However, there is no confirmation on the reversal of the uptrend. Wave pattern suggests that the rise from the Dec. 23 low of $46.16 has been driven by a wave V, which is expected to be as long as the wave I.

Apparently, this wave V looks too short to complete.

It is not very clear if oil could break $48.48. A break could lead to a gain to $49.31 while a break below $47.13 could cause a fall to $46.30.

On the daily chart, a shooting star formed on Monday, which is the warning signal that the uptrend may reverse. But this pattern could also be a random occurrence of market weakness. Only a fall below $46.30 could confirm a reversal of the uptrend.

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