Technical & Fundamental Oil Reports Specialists

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Watch the s/t MAs: they are the key; “Bear trap” alert!

Published Friday, October 31st, 2014

The contracts gave up some ground yesterday and apart from WTI the closes were not that poor. WTI closed just below the lowest of its short term (s/t) MAs last night but is up re-testing these key levels this morning. Brent closed below the highest MA – the 5 around 86.27 – but only by 3cts, and it was above the 8 and 13. The rest closed above all the s/t MAs. So yesterday must, at the moment, be seen as merely too much too soon and a correction back and not a failure. In other words, last night’s lower levels are likely to be a “bear trap” rather than a resumption of lower numbers. This rather positive view would be negated by moves confirmed by closes (m/c) below the s/t MAs. These are critical “must watch” support on Brent around 85.89; Heat 248.20; RBOB 214.77; and Gasoil 739.00. In the meantime, the momentum higher is maintained whilst above the highest of the s/t MAs on Heat around 249.52; RBOB 215.83 and Gasoil 745.50. The stochastics are positive but a bit wobbly.

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Posted by Robin Bieber