Technical & Fundamental Oil Reports Specialists

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Watch RBOB. Market looking fragile and uncomfortable up here.

Published Wednesday, February 18th, 2015

The market is fragile and appearing to lose momentum. I mentioned yesterday that it would need 24 hours to clarify the situation and allow the contracts to trade unhampered by IP week and a US holiday. The results – i.e. yesterday’s price action and last night’s closes – should cause concern to the bulls. RBOB closed below the pivotal and key breakout point at 162.60. This is very important, and not positive, because RBOB so often gives reliable early warning signals that the rest then follow. Both Heat and RBOB are below the bull/bear pivots – i.e. in the lower 50% of yesterday’s price action. Finally RBOB has, overnight, slid below its 5 day MA around 158.84 today. The potential to go lower is by no means confirmed, but the need to be very careful and scale back length is advised. The upside potential would only be green lighted on RBOB both moving and closing (m/c) over the 5 day MA and 162.60. The latter is a must or the contracts will falter and may well head south. The early warning is there – the question is whether it’s valid or not. Apr’ WTI has no target higher. It is below both the 55 day MA at 54.19 and the pivotal range resistance at 55.05.

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Posted by Robin Bieber