U.S. oil NYMEX:CL1! faces resistance at $69.34 per barrel; a break above could spur gains toward the $69.88-$70.56 range.
Given the time and effort required for the market to overcome the former resistance at $68.80, it may fail to break $69.34 on its first attempt, as that level is stronger than the one at $68.80.
The tricky part is how long and how deep the subsequent correction would be. A shallow correction is expected to end around $68.80, while a deep one may extend to $68.13.
Regardless of the exact move, the contract may eventually break $69.34 and rise toward $71.64, the peak of wave IV, as a five-wave cycle from the June 3 high of $97 may have completed.
On the daily chart, the contract stabilized around a support at $66.78. It may bounce toward $72.23.
* Wang Tao is a Reuters market analyst for commodities and energy technicals. The views expressed are his own. His analyses are exclusively published on the Workspace platform - a London Stock Exchange product.
** 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.