The support was provided by the 76.4 percent projection level of an upward wave (c) from $4.90. The current drop was triggered by the resistance at $5.19-1/2. The drop is much deeper than expected. It signals a completion of the wave (c).
The pattern from the Oct. 25 low of $4.85-1/2 looks like a rising wedge, which could turn out to be a bearish continuation pattern, as it developed after a downtrend.
A break below $5.01-1/4 could confirm the pattern. A bearish target at $4.90 will be established accordingly. A break above $5.12-1/2 could lead to a gain to $5.19-1/2.
Wang Tao is a Reuters market analyst for commodities and energy technicals. The views expressed are his own.
No information in this analysis should be considered as being business, financial or legal advice. Each reader should consult his or her own professional or other advisers for business, financial or legal advice regarding the products mentioned in the analyses.