Crude oil extended fall from 83.95 to as low as 72.65 before recovering. Downside momentum is a bit unconvincing with 4 hours MACD staying above signal line. Nevertheless, further decline is still in favor as long as 75.42 minor resistance holds. Next target will be a retest of 68.59 support. On the upside, above 75.42 will indicate that a short term bottom is possibly formed and should bring strong recovery then.
In the bigger picture, upside momentum is clearly diminishing as seen in bearish divergence condition in daily MACD. However, there is no confirmation that medium term rise has topped out yet as long as 68.59 support holds. Such medium term rise could still continue and above 83.95 will target 50% retracement of 147.27 to 33.2 at 90.24, which is close to 90 psychological level. Nevertheless, even in such case, we'll continue to look for reversal signal and expect crude oil to top out finally as it approaches 90 level. On the downside, break of 68.59 support will confirm that a medium term top is in place and will turn outlook bearish for a retest on 33.2 low as correction from 147.27 resumes.....Nymex Crude Oil Continuous Contract 4 Hours Chart
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