US oil may retest resistance at $52.98
- As long as the contract remains firm above a support at $52.34, the 23.6% retracement of the uptrend from $47.18 to $53.93, it may revisit the high of $53.93.
SINGAPORE: US oil may retest a resistance at $52.98 per barrel, with a good chance of breaking above this level and rising towards a range of $53.34-$53.93.
The resistance is identified as the 61.8% retracement of the downtrend from $53.93 to $51.44. The trend from $53.93 has reversed, as oil has deeply pierced above $52.98.
To fulfil the target zone, oil needs to stay above $52.39, a break below which will not only cause a fall into $51.80-$52.03 range, but also signal an extension of the downtrend.
On the daily chart, the correction from $53.93 is very shallow. It ended around $51.35, roughly matching the one from the Dec. 23 high of $48.50. It may have been driven by a wave iv, which will be reversed by an upward wave v.
As long as the contract remains firm above a support at $52.34, the 23.6% retracement of the uptrend from $47.18 to $53.93, it may revisit the high of $53.93.
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