SINGAPORE: US oil may retest a support at $81.91 per barrel, a break below which could cause a fall to $79.56.

The drop from the Jan. 19 high of $81.91 observes two sets of retracements, respectively on the uptrend from $66.04 and the bigger trend from $62.43.

It is clear that the uptrend from $66.04 has reversed, as a rising trendline was violated. What is not clear is how deep the current fall would be.

The retracement analysis marks a target range of $78.18-$79.56. The drop from $87.91 might be counted as a wave 4.

This wave count will only be valid if oil could remain above $81.90.

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Resistance is at $84.72, a break above which could lead to a gain to $86.13.

On the hourly chart, the current fall could be of the same degree with the one from the Dec. 9, 2021 high of $73.34.

A rising channel suggests a target around $78.97.

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