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Short-term daily M/As are still acting as resistance

Published Wednesday, March 19th, 2014

A quick glance at the daily changes tells us what drove the market higher yesterday – It was WTI. The rest was somewhat lagging behind. Does it mean that the strength was temporary and the original downtrend resumes today or is it an early warning signal that the underlying bearishness is evaporating? Well, the fact is that all the daily short-term M/As are still above the current price levels with the exception of the 5-day on May WTI. It is currently at 98.30. Based on this it would be pre-mature to get bullish but given the convincing performance from the NYMEX crude, being negative is not justified either. Of course, the technical picture would change if the rest of the contracts settled over the 5 and 8-day M/As tonight. These are as follows: 106.99 and 107.21 on Brent. The latter is incidentally the 61.8% correction point of the recent uptrend making this level a strong resistance area. Heating Oil settled back over the 290.64 range resistance but only a close above the 5 and 8-day at 291.58 and 292.91 will be considered somewhat bullish.

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Posted by Tamas Varga

Tamas Varga has been in the oil industry since 1992 and with PVM for 18 years. During his time in the industry he has gathered a range of experience in the oil markets. At PVM Tamas is in charge of data collection and analysis.