U.S. oil may retest support at $79.93
XLE•Technical view on U.S. oil
SINGAPORE, Aug 27 (Reuters) - U.S. oil CLc1 may retest support at $79.93 per barrel, a break below which may trigger a fall to $77.79.
The bounce triggered by the support is considered a part of the right shoulder of a head-and-shoulder forming from the August 12 high of $84.35.
The pattern will be confirmed by a break below $79.93. Considering that the left shoulder took about two days to complete, the current right shoulder may finish on Friday.
The market is assumed to drop to $79.93 first, followed by a bounce towards $81.66. A break above $83.39 may lead to a gain to $85.53.
On the daily chart, a rising trendline points at a target of $78.17. The fall from $89 looks deep enough to suggest a continuation of the downtrend from $93.50.
The continuation will be confirmed when the market breaks $78.17.
