Crude oil futures for May delivery are testing key support levels and an “immediate bounce” is needed for the contract to return to recent highs, according to technical analysis by Newedge Group. If prices break through support at the $47.50 to $48, a barrel level, the contract may fall toward $46 a barrel and as low as $43.74, Veronique Lashinski, a senior research analyst for Newedge USA LLC in Chicago, wrote in a note to clients yesterday. Failure breach the support level may indicate a “bounce” to $54, she said. “We can’t go any lower than $43.74 without causing severe technical damage,” Lashinski said in a telephone interview yesterday. This chart will be the daily technical focus until the May contract expires on April 21, she said. Crude oil for May delivery reached $54.66 a barrel on the New York Mercantile Exchange on March 26, the highest since Nov. 28. The contract rose 23 cents, or 0.5 percent, to settle at $49.38 a barrel yesterday. A longer-term study features resistance around $55 and $60 and support around $38.50 and $40, according to the report. “It will take a lot to get above $60 unless there is a big change in the market fundamentals,” Lashinski said. “It looks like we have found market equilibrium here.” Technical traders watch for patterns on daily charts for clues to price direction, and may sell or buy based on those signals.

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