Crude Oil Prices See Temporary Rally as Analysts Predict Deeper Correction

Crude oil prices have been on an upward trend after recent attacks, but analysts at CAPITALCOM suggest this may be a temporary rally. The current rebound could be part of a countertrend recovery in wave C, which might be the third leg of a larger correction.

The analysts believe that despite reaching resistance areas around 96 and 100, the price is still likely to drop further due to the overall bearish structure of the market. The initial five-wave decline from 119 in an impulsive trend indicates that the current pullback might not be as strong as some expect.

However, the analysts also warn that prices often stop between the 38.2% and 61.8% Fibonacci retracement levels during counter-trend moves, which could influence the depth of the upcoming correction.