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More negative as long as the 8-day M/As are above the price action

Published Wednesday, July 22nd, 2015

Whilst RBOB is living in its own world the whole complex decided to correct meaning that RBOB closed lower and the rest higher. The broad technical picture has not changed as no resistances were closed above and supports were not bothered either yesterday. The risk remains on the downside for the following reasons: all the daily short-term M/A are still above the price action and the market will turn neutral if the 8-day M/As are closed over and bullish if the 13-day M/As are broken and settled above. These are currently 51.48/52.00 on WTI, 57.27/53 on Brent, 168.14/169.71 on Heating Oil and 519.25 and 524.00 on Gasoil. On RBOB the 8-day M/A is currently at 191.32, very close to the 5-day at around 191.53. The contract failed up there yesterday but if it is penetrated and closed above tonight we should see a jump up to the 13 and 200-day both at 194.15. If the latter is below tonight’s close much higher numbers are expected. This is at the moment only a distant possibility as the 5-day has been broken below this morning and if the contract fails to rally and close above it then the test of the 200-day continuation M/A at around 185.66 will be anticipated tomorrow.

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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.