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There are targets lower on each of the contracts

Published Monday, August 4th, 2014

It was suggested in Friday’s report that whilst the underlying sentiment was increasingly bearish we could see some pre-weekend short-covering rally. This view turned out to be misplaced as all the contracts settled lower. Not only did they settle down on the day but they also closed below important support levels. There is some kind of strengthening this morning but former support acting as resistances now have not been moved over. This means that there are valid objectives below the market. These targets will only be put on hold if resistances are settled and closed above. This resistance is the 98.68 range on WTI. It is the daily low on July 15. Whilst it is above the price action Friday’s low at 97.09 which is close to the 200-day M/A at 97.05 should be under pressure again. On a break below this support the 96.43 range support and daily low on May 5 will be tested. A close below the latter is rather negative. Brent settled below both the 105.59 and the 105.26/16 range support area. Unless the higher of these are settled back over the 104.07 range support is where this contract should heading to. A close below this level is bearish and such a close is a sell.

to read the rest of the report, please click here 

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.