Technical & Fundamental Oil Reports Specialists

Follow us

Test of supports on both sides of the Atlantic

Published Tuesday, March 3rd, 2015

Both contracts traded lower yesterday. Those who were short on NYMEX are still likely to be short as the nearest support was not really tested. On ICE the weak close meant that the contract did turn bearish and this settlement was a sell. Follow-through selling pressure has pushed the price down to the nearest support and further weakness is expected to take place today.

April ICE: The support that had to be closed below was the 48.87/76 area. The former is the 8-day M/A and the latter is the 38.2% retracement level of the January-February uptrend. This close duly happened and bears who decided to sell short found that the nearest support has already been tested this morning. It is the 200-day continuation M/A that is at 47.80 at the time of writing. It is, therefore, recommended to half any short positions and keep the other half. In case of further weakness it only makes sense to go flat on a test of the 47.08/00 range support area. These are the daily lows on February 23 and 24. The chances of testing the latter will jump on an intra-day break below 47.59, the 50% correction point of the aforementioned uptrend. Short positions then should be re-established if the 34-day contract M/A at 46.72 is closed below.

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.