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Expect a test of the bottom of the current range

Published Tuesday, July 29th, 2014

There is not much to add to yesterday’s report where we established the current trading range. The whole complex weakened yesterday, tested the bottom end of the range but did not close below. It is still imperative to keep an eye on the 13-day M/A on WTI. It was closed a few cents above yesterday but has been moved below this morning. It is currently at 101.59 and should it be settled below the contract should fall down to the 100 and 200-day M/As at 100.26 and 99.91 respectively. If it holds then the 34-day M/A, the top end at 103.33, will be tested. Brent is right in the middle of its range. The massive support is made up by the recent lows and by the 200-day M/A that are between 106.94 and 106.75 whilst the top end is the 108.60/62 level, recent highs on the September contract. Given that the short-term daily M/As are above the current price action (they are between 107.51 and 107.70) the test of the bottom end is slightly more likely than the top end, nevertheless there are no targets either way at the moment.

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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.