SINGAPORE: Brent oil may stabilize around a support of $103.67 and retest a resistance at $106.87 per barrel.

The sharp bounce on Thursday is tentatively classified as a pullback towards a rising trendline.

A retracement analysis on the downtrend from $120.41 to $98.50 suggests a target zone of $106.87 to $109.46.

The downtrend remains intact, which is riding on a wave (C) that could travel to $91.03.

This wave is expected to resume upon the completion of the bounce in the target zone.

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A break below $103.67 may trigger a drop into $100.03-$101.70.

Such a drop would be deep enough to confirm a continuation of the downtrend.

On the daily chart, a piercing pattern formed between Wednesday and Thursday. It signals a further bounce.

Wave pattern suggests the progress of a wave (C) from $125.19, which is more likely to travel to $83.63 than to complete around $99.51.