SINGAPORE: Brent oil may drop to $119.84 per barrel, as it has broken a rising trendline. The break suggests a reversal of the uptrend from $112.45.
A retracement analysis reveals a target zone of $117.01-$119.84. Strategically, the zone will be confirmed when oil breaks the nearest support at $121.58.
Resistance is at $122.66, a break above which may lead to a gain into $123.56-$124.40 range.
On the daily chart, oil failed to break a key resistance at $123.01 again.
The failure has triggered a drop towards the rising trendline, which establishes a support around $118.03.
A stronger impact of this failure is on the steadiness of the uptrend from $96.93.
The trend is highly likely to reverse, once oil drops to $118.03 and closes around this level on Friday.