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Test of supports on ICE – NYMEX is trying to break higher

Published Friday, February 20th, 2015

March ICE: The contract fell out of bed, it closed below all of its daily short-term M/As, also below the 50% retracement level of the January-February rally at 49.47 and its daily slow stochastics is firmly negative. In a week from high to low it has lost 13% of its value. There is a shorter way to describe the current status of the market: it is bearish. Of course, there is always a danger of a bear trap but this danger would only be manifested in a close back over the 49.47 correction point. Only in that case would the contract turn neutral. Until that happens it is expected to test the 61.8% c/p of the same uptrend at 48.03. On a drop down there shorts are recommended to take profit on half of their positions. The other half should then be closed out on a test of the 47.64/58 area. This is a massive support level made up by the 200 and 34-day continuation M/As.

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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.