A re-labelling of the waves suggests that the rebound from $79.78 was due to the completion of a three-wave cycle that developed from the Sept. 30 high of $94.90.
Given that the rebound could be divided into another three small waves labelled a, b and c, this rebound seems to be over. The downtrend could have resumed within a small falling channel, the lower channel line of which points a target at $78.
A Fibonacci retracement on the fall from the Oct. 3 high of $91.79 to $79.78 reveals a resistance at $82.61, the 23.6 percent, a break above which will lead to a further gain to $84.37, the 38.2 percent retracement.
** Wang Tao is a Reuters market analyst for commodities and energy technicals. The views expressed are his own.
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