The resistance is identified as the 100 percent projection level of an upward wave (c) from $64.02. This wave could either peak around $72.26 or extend much beyond this level. The bearish divergence on the hourly MACD simply suggests a peak around $72.26.

Strengthening the resistance is another one at $72.71, the the 100 percent projection level of a wave C from $59.49. On the daily chart, there are similar resistances to prevent a further gain.

A retracement on the downtrend from $86.74 to $49.93 and on the uptrend from $27.10 to $86.74 reveals two resistances at $72.68 and $72.66. These resistances work together with the two resistances on the daily chart to end the uptrend. Most likely, oil will fall towards $68.33.

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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.