U.S. oil NYMEX:CL1! may retest support at $69.13 per barrel, a break below which could open the way toward the $66.35-$68.07 range.
Unlike Brent oil ICEEUR:BRN1!, WTI shows little sign of reversing its downtrend. The latter has been consolidating within a wedge, which appears to be a bearish continuation pattern.
A break below $69.13 could confirm the wedge. Resistance is at $70.85; a break above it may lead to gains into the $71.91-$72.56 range.
Such a gain would confirm the wedge as a bottom pattern. On the daily chart, signals are mixed, with the market trading sideways around support at $70.52. A further development of the chart is needed to evaluate the following move.
While the daily RSI shows bullish divergence, the bullish signal will only be confirmed if prices remain above $70.52.
* 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.