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Pressure on supports on both contracts

Published Wednesday, April 15th, 2015

It was said in yesterday’s report that the ICE contract is neutral and NYMEX is bearish. Given the weakening of the ICE natgas it is not the case anymore as it settled below important supports. NYMEX did not bother resistances and it still has a valid downside objective. If anything, both contracts are now expected to fall further and have a real go at the nearest strong support areas.

 

May ICE: We said 24 hours ago that the contract is neutral but the odds are higher on closing above the 100-day M/A resistance than below supports. Nevertheless it was pointed out that going long is only advised if this resistance is settled above. Such a close was not meant to be and the contract fell and closed below the daily short-term M/As and below the 34-day M/A, too, although only by 3 points. The close was a sell. New shorts are probably not as comfortable on this contract as on NYMEX given that the settlement was only a few points below the 34-day M/A support which is currently at 45.65. It is advised to go flat on a close back over it otherwise try and run the positions down to 43.52 where profit-taking is recommended. This is the daily low on the May contract on March 23. Going long is only advised on a close above the 100-day M/A at around 46.79.

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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.