Oil prices surged higher intraday on Tuesday. Prices tested a new 13-month high of 62.96 in the early Asian trading session.
However, since then, oil prices gradually drifted back lower. The test of support near 60.87 confirms that prices are well supported at this level.
However, for the short term, oil prices will need to breakout higher and continue further to maintain the bullish trend.
The Stochastics oscillator on the four-hour chart is also likely to signal another push to the upside.
For the moment, the line in the sand is the 60.87 technical support. If oil prices lose this support, then we expect a deeper correction down to 57.35 or toward the 19 Feb lows of 58.56.
