SINGAPORE: US oil may retest a resistance at $76.77 per barrel, a break above which could open the way towards $77.46-$77.84 range.

The contract has found a strong support at $74.87, which is strengthened by a similar one of $75.20 and another support established by a rising trendline.

The bounce to $76.92 on Thursday could be the first leg of a three-wave cycle. The third wave is likely to travel into $76.77-$77.46 range.

At least, oil may consolidate in the range of $74.87-$76.77 for one or two days before falling again.

Oil steadies on mixed economic data

A break below $74.87 could open the way towards $73.80. On the daily chart, oil broke a support of $77.24. The break not only opened the way to $71.76, but also suggested a continuation of a wave (C) from $123.68, towards $62.89.

What appears to be a further bounce on the hourly chart could be interpreted as a pullback towards $77.24, a former support.