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Erratic action expected – Sell rallies to the 8s – Valid targets lower

Published Monday, January 12th, 2015

The trend is down. The price action is expected to be increasingly volatile as bottom pickers enter the arena placing great trust in corrections, which so far have ended in tears at mostly the 5 or, less frequently, the 8 day MA resistances. It is very likely that the 5s, which are very close to the price action, will be breached today and we’ll witness a run to the 8s. Rallies to the 8s are a sell. There are targets lower on WTI to 45.95; Brent 48.18; Heat 164.32; RBOB 117.83; and Feb’ Gasoil 451.50. These are valid whilst below the 8 day MAs – run shorts to these objectives. WTI closed below the b/b pivot on Friday (at 48.69) and has, as a result, an objective to 45.95, valid whilst below the 8 day round 49.66. Run shorts to the target. It is entirely possible that the market will correct up this morning to at least the 5 day and b/b pivot at 48.26/39 (it has virtually done this already overnight) and may well take this resistance out and head for the 8 day around 49.66, a sell. A failure to move over the 5 would be a sign of more momentum lower.

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Posted by Robin Bieber