Crude Oil Weekly Technical Outlook For Sunday June 20th

Crude oil recovered further to 78.18 last week but lost momentum and turned sideway. Initial bias is neutral this week. Note that we'd still expect strong resistance at 61.8% retracement of 87.15 to 64.23 at 78.39 to limit upside to conclude the whole recovery from 64.24 and bring reversal. Below 73.26 minor support will flip intraday bias back to the downside. Further break of 69.51 will target a new low below 64.24. However, decisive break of 78.39 will dampen our view and target a retest on 87.15 high instead.

In the bigger picture, whole medium term rebound from 33.2 is likely completed at 87.15 already, just ahead of 50% retracement of 147.27 to 33.2 at 90.24. Further decline should be seen to 50% retracement of 33.2 to 87.15 at 60.18 at least. Also, as rebound from 33.2 is viewed as as a correction to the whole correction that started at 2008 at 147.27, we'd anticipate a break of 33.2 low in the longer term. On the upside, however, decisive break of 78.39 Fibonacci resistance will dampen our bearish view and argue that another high above 87.15 might be seen before crude oil tops.

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 fro 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.....Here's the charts.


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