SINGAPORE: A bullish target of $67.98 per barrel has been temporarily aborted for US oil. It will only be resumed when the contract breaks a resistance at $66.52.
The strong reaction of the market to the resistance at $66.52 has resurrected the abandoned assumption that the rise from $57.25 is indeed a part of a correction from $67.98.
Unless oil could quickly reverse the fall on Wednesday and break $66.52, it will be more likely to drop towards $62.62-$63.88 range.
On the daily chart, oil failed again to break a resistance zone of $65.65-$66.60. The failure suggests the start of a correction which is expected to be shallower than the one from the March 8 of $67.98.
It is not very clear how deep this correction could be. Most likely, it will extend into the range of $61.79-$64.18.
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