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ICE is on strong support – NYMEX should fall a bit

Published Tuesday, April 28th, 2015

June ICE: The 8-day M/A was tested and broken over but the contract did not get near to the 13-day in the early hours of yesterday’s trading. This loss of enthusiasm brought out the sellers in the latter part of the day and the contract went into support testing mode. Shorting the market at the 8-day M/A resistance proved to be a good idea as the strong range support was assaulted towards the close. This is the 42.10/06 level, the daily lows on the June contract on March 6 and April 24. Shorts have probably covered their positions there and went home with a squared book. The current technical status of this contract seems straightforward. It is bearish therefore closes below supports or rallies to resistances are deemed to be sells. It is advised to go short if 42.10/06 is settled below for a fall down to 40.49, the daily low on the June contract on January 20. A rally to the 13-day M/A, currently at 43.27 is a sell for a drop to the 42.10/06 support. No short positions are to be held on a close above the 13-day M/A. Actually, on such a move it is recommended to go long. Watch the 42.10/06 level today.

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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.