Crude Oil Weekly Technical Outlook For Saturday Aug. 7th
Crude oil edged further higher to 82.97 last week but retreat sharply since then. A temporary top is at least formed and initial bias is neutral this week. We’d continue to seem more retreat below 82.97 first. Nevertheless, note that another rise remains in favor as long as 75.90 support holds. Above 82.97 will target 100% projection of 64.23 to 79.38 from 71.09 at 86.24 next. However, break of 75.9 will be the first signal that whole rebound from 64.23 is finished and will turn focus to 71.09 support for confirmation.
In the bigger picture, there is no change in the view that rise from 64.23 is a correction to fall from 87.15 only. Hence, even in case of further rally, we’d expect strong resistance below 87.15 high and bring reversal. On the downside, break of 71.09 will be the first signal that whole fall from 87.15 is resuming for another low below 64.23 towards 50% retracement of 33.2 to 87.15 at 60.18
In the long term picture, current development suggests that rebound from 33.2 is finished at 87.15, inside 76.77/90.24 fibo resistance zone as expected. Our view is that fall from 87.15 would develop into the third falling leg of the whole correction from 147.27 and hence, we’d anticipate an eventual break of 33.2 low in the long term as such correction extends.
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