Technical & Fundamental Oil Reports Specialists

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Watch the key supports -13 day on the crudes

Published Tuesday, October 13th, 2015

Introduction. Moves that have been encouraged by geopolitical events have a voracious appetite for nasty headlines. Any drying up of this steady requirement causes a market to wobble. This was compounded yesterday by a US holiday making things precarious. Once the key support failed the downside momentum increased and, in most cases, even the usually reliable short term MAs, lined up in depth below the market, failed. It was a vicious correction. The crudes both closed below the 5 and 8 day MAs but held the 13. The rest closed below all the short term MAs but held some key support levels. The question now is can the support hold and create a “bear trap” or are we heading south to the bottom of the range? The key levels that need to hold are the 13 day MAs on the crudes around 46.71 WTI and 49.76 Brent; and then range support on the rest at 149.08 Heat; 135.00 RBOB; and 463.25 Gasoil (a c/p). Meanwhile the stochastics have flipped south, which is not supportive. WTI slid below the 5 and 8 day MAs and is now holding over the 13 day around 46.71. This needs to hold or it heads lower to the c/p and 34 day at 46.18/11. Resistance starts around 47.76 (8 day) then 48.35 (5 day). A move back over the 8 day – around 47.76 – would suggest that yesterday’s dump has little follow through and that the bears should be careful. Watch the 8 and 13 day MAs here – they are going to give us the next leg.

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Posted by Robin Bieber