SINGAPORE: Brent oil may retrace further to $94.20 per barrel, following its failure to break a resistance at $99.48.

The failure and the subsequent drop signal a completion of a wave (5). Based on this reading, oil may retrace towards the bottom of the wave 4 around $90.

Strategically, the target will only be confirmed when oil breaks the immediate support at $95.90, as the drop from the Tuesday high of $99.50 could also be interpreted as a pullback towards the Feb. 14 high of $96.78.

Brent oil may rise into $98.47-$99.48 range

A break above $97.32 may lead to a gain into $98.47-$99.48 range.

On the daily chart, the bearish divergence on MACD reveals a weakness of the market.

A decent correction is due.

Even though oil broke the upper trendline of an expanding wedge, the break may not lead to an impressive gain, in view of the divergence on MACD.

Instead, oil is facing bigger risk of a sudden drop.

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