The range is formed by the 114.6% and the 100% projection levels of a downward wave C from $9.36-1/2. The wave could be the third part of a five-wave cycle from the June 18 high of $9.48.

Based on this wave count, the contact is biased to break $8.70-1/4 and fall into the range of $8.56-1/2 to $8.65. A break above $8.78-3/4 could lead to a gain to $8.86-1/2.

On the daily chart, the contract may fall to $8.66, the 61.8% retracement on the uptrend from $8.15-1/2 to $9.48, as it has been hovering below $8.81-3/4 after breaking this level. A break below $8.66 could open the way towards $8.46-3/4.

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** Wang Tao is a Reuters market analyst for commodities and energy technicals. The views expressed are his own.

No information in this analysis should be considered as being business, financial or legal advice. Each reader should consult his or her own professional or other advisers for business, financial or legal advice regarding the products mentioned in the analyses.