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NYMEX has turned bearish – Patience on ICE

Published Friday, May 9th, 2014

If you are wrong then be completely wrong. This could be the motto after yesterday’s price action when neither of the contracts lived up to their expectations. There was no test of supports on ICE instead the contract rallied and closed much higher. There was no test of resistance on NYMEX as strong supports were closed below. The only difference is that whilst NYMEX firmly reversed course ICE has not turned definitely bullish just yet.

June ICE: The reason not to be bullish just yet is that although the 45.50 range was closed back over, the 5 and 8-day M/As (45.97/46.21) are being tested and the 13-day M/A  at 47.18 is still above the current price level. Should it be settled above we would expect further strength early next week. In that case the next logical target the market should be heading to is the 38.2% retracement level of the preceding trend at 47.98 and it is followed by the 50% correction point at 48.99.

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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.