SINGAPORE: US oil may revisit its May 15 low of $69.41 per barrel, where a wave c started. This wave could be well broken down into five smaller waves, with the final wave failing to extend above a resistance at $73.33.
The failure, along wit the subsequent deep fall, confirms a completion of this wave, and the whole bounce from $63.64.
Oil is expected to first drop to the bottom of the wave b at $69.41 and then towards $63.64.
Resistance is at $71.83, a break above which may lead to a gain limited to $73.33. On the daily chart, the consolidation above $70.02 may have quietly ended.
US oil may retrace to $71.83 before rising
The resistance at $75.62 could never be tested, at least in short term.
The only meaningful action could be simply to wait for a break below $70.02.
Confirmation of such a break will be when oil falls below $69.41.
A bearish target zone of $62.89 to $64.42 will be established upon the confirmation of the break.
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