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Downtrend is still intact on ICE and uptrend on NYMEX

Published Wednesday, June 17th, 2015

Both contracts settled higher yesterday which made NYMEX bulls less concerned than those with short positions on ICE. From the technical perspective, however, there is nothing to worry about for ICE bears as resistances were not settled above and the contract is drifting lower again this morning. Targets (downside on ICE and upside on NYMEX) are still valid and expected to be tested. The only concern could be that it is taking a long time for both contracts to achieve their respective objectives. If no advances are made today the flavour of tomorrow’s report will be more cautionary.

July ICE: This contract settled right on the 5 and 13-day M/As that are currently at 42.37 and 42.63. The 8-day M/A proved to be a tough nut to crack and the market closed below this resistance. It is at 42.82 at the time of writing and it is still recommended to cover short positions if it is broken and closed above. Should this happen the contract will turn bullish and going long would be recommended. On the downside the 41.19 downside objective is still valid. The odds of reaching it will jump if 41.80, the daily low on the July contract on May 5, were to be penetrated. Shorts should take profit just above 41.19 and sell short again if 41.00 is closed below.

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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.