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ICE failed at resistance. NYMEX is trying to punch higher.

Published Tuesday, October 20th, 2015

Both contracts strengthened yesterday but this strength was not quite enough to change the underlying technical picture. This picture is still more negative on ICE and very much undecided on NYMEX. The latter contract, however, is trying hard to put important resistances under pressure this morning.

November ICE: Yesterday morning it was recommended to start scaling back on short positions and go completely flat if or when the 8-day M/A resistance is settled above. It was briefly broken above, the 13-day was tested then the contract started to come off. It finished the day in positive territory and above the 40.50/45 support area but below both the 8 (40.86) and 13-day M/As (41.18). There is nothing wrong with running reduced short positions. The only change from yesterday’s report is that it is now recommended to go flat on a close over not the 8 but the 13-day M/A. As a matter of fact acquiring length will be desirable on such a move as from the technical perspective the current trend would flip from slightly bearish to bullish. On the downside it will make sense to top up short positions on a close back below 40.56 (5-day M/A) and 40.50/45 (range) as in that case the former downside objective of 39.46 will be re-instated.

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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.