SINGAPORE: US oil may retest a support at $93.80 per barrel, a break below could open the way towards $90.55.
The contract has fallen below a triangle, which was confirmed as bearish continuation pattern, suggesting a target of $90.55, the 100% projection level of a wave (c) from $108.75.
In the meantime, oil observes closely another set of projection levels on the downtrend from $116.64.
The support at $93.80 triggered a bounce. Due to the incomplete wave (c), the bounce may end around the resistance zone of $97.50 to $98.16.
A break above $98.16 may lead to a gain into the $99.65-$101.80 range. On the daily chart, the consolidation is taking the shape of a bigger triangle, which could be ending.
US oil may test support at $97.50
The spinning top on Thursday works as the first reversal signal.
A white candlestick on Friday will be ideal to confirm the reversal.
Readings on the hourly chart suggest a brief piercing below $93.79, followed by a decent rally.
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