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13-day M/As are the ones to watch on both contracts

Published Friday, June 19th, 2015

Neither contract tested their respective targets before changing course yesterday. ICE that was bearish 24 hours ago and NYMEX that was supposed to test resistances are neutral therefore it is recommended to be flat on them. Whether the recent trends will continue and yesterday’s movements will prove to be just corrections will be determined by the price action around the 13-day M/As. These are being tested on both contracts this morning. It is a resistance on ICE and a support on NYMEX.


July ICE: The low was 41.60 yesterday whilst it was recommended to cover short positions just above 41.30. It was also advised to go flat on a close above the 34-day which did not exactly take place but the contract is above it this morning. It only makes sense to be flat and wait for developments. The 13-day M/A is at 42.67 at the time of writing and the formula seems rather straightforward. The market has failed to get down to supports, rallied and is flirting with the highest of the daily short-term M/As. Common sense suggests that a close above it is a buy. In that case expect further strength on Monday that should take the price up to the 43.31 range resistance and possibly as high as the 44.10 continuation gap. A failure to close above the 13-day M/A is a sell as in that case the test of the recent low at 41.60 will be expected early next week.

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Posted by Stephen Brennock

Stephen Brennock joined PVM in 2013 after having worked as a project manager for a business development firm. He graduated with a degree in Business Management in 2007.