Technical & Fundamental Oil Reports Specialists

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The 5 and 8 will determine the next leg – Watch these carefully

Published Wednesday, June 25th, 2014

The trend remains up. The dip yesterday was through the 5s down to the 8s – text book slingshot – and then the contracts bounced and closed over the 8s but below the 5s. WTI dipped below both the 5 and 8s and then headed straight for the 13, which it held and bounced from but closed below the 5 and 8s. The key once again is the action at the 5 and 8s – they will dominate the action and determine the next leg. Look for the resistance at the 5s to come under pressure early today. However, there is a worrying lack of harmony in that yesterday’s rally was accompanied by negative stochastics across the board. This is even true of WTI which is above all its short term (s/t) MAs. This lack of harmony should make one careful, but moves and closes (m/c) over the 5s would green light a move back to the recent highs regardless of the stochastics. It is not advised to be short whilst above the 8s. WTI did well yesterday – holding the 13 on the dip and then rallying. It is now above both the 5 and 8s and needs a m/c over 106.84 to green light a leg back to the 107.45.

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Posted by Robin Bieber