SINGAPORE: US oil looks neutral in a range of $84.95-$87 per barrel, and an escape could suggest a direction.
Even though the downtrend from $93.64 remains steady and may resume over the next few days, the exact timing of its continuation remains unclear.
It is also not very certain if oil bounces towards $87 first before dropping.
A fall below $84.74 could confirm the continuation of the downtrend and a target zone of $82.89-$83.56.
A break above $87, which looks unlikely, may lead to a gain into $88.55-$89.16 range.
On the daily chart, following its failure to break the resistance at $92.80, oil dropped for three consecutive days.
US oil may retest support at $85.69
There are more black candlesticks than white ones since the drop started.
Such a formation clearly sends a bearish signal that the downtrend would extend further.
The support at $85.59 only triggered a very weak bounce.
It looks vulnerable and may be broken soon.
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