The resistance is provided by the 23.6 percent retracement of the uptrend from $8.39-3/4 to $9.41. A correction triggered by this barrier has been almost reversed. The reversal is a strong signal that the uptrend from the Jan. 16 low of $8.91-1/2 has resumed.
Strategically, the target zone of $9.26-$9.41 will be confirmed when the contract breaks above $9.20-1/4, the 61.8 percent projection level of an assumed wave C. A failure to overcome this barrier could cause a loss to $9.02-1/4.
On the daily chart, it is hard to conclude which wave is driving the current rise. It could be a wave e or wave C. The former may end around $9.47, while the latter is capable of traveling into the range of $9.72-1/4 to $10.03-3/4.
Regardless of the wave count, a retracement analysis reveals a resistance at $9.21-3/4, the 38.2 percent level, which works together with the one at $9.20-1/4 (first chart) to prevent a further gain.
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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.