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Further pressure on supports

Published Thursday, April 9th, 2015

It paid off for bulls to be careful on Tuesday evening and yesterday when the complex tested, but in most cases failed to close above the 34 and the 100-day M/A resistances. After this failure the market fell out of bed yesterday and with the exception of WTI the contracts closed below all of their daily short-term M/As. This suggests further test of supports in the immediate future, especially if the NYMEX crude closes below the 8 and 13-day M/As which are currently at 50.43 and 49.94. In that case this contract should fall to the 47.05 range support. The latter is the daily low on the May contract on April 1. Yesterday’s weakness will only be viewed as a bear trap on a close back over the 5-day M/A at around 51.33 in which case the 52.48 range resistance and possibly the 100-day M/A at 54.97 should be shortly in sight. After yesterday’s weak performance Brent should now fall to 54.00, the daily low on the May contract on April 2 and on a close below this support the 52.57 range support and daily low on March 17 is expected to be tested.

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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.