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ICE is holding supports but NYMEX closed below them

Published Monday, November 30th, 2015

Both contracts closed lower on Friday. Those who were long on ICE probably remained long as the short-term daily M/As, albeit seriously tested, were not settled below. NYMEX, on the other hand, not only had a go at crucial support area but settled below therefore we had a valid sell short signal on the close on Friday.

January ICE: Ever since this contract gave a buy signal last Tuesday it has gone very quiet and refused to both disappoint and encourage those with long positions. It was the case on Friday again as resistances were not in danger of being tested and supports proved to too strong to overcome. The supports in question are the daily short-term M/As that are between 38.15 and 37.83 this morning. A close below the lowest of them, the 13-day, will be a sign to get rid of long positions and even go short. In that case we would expect the test of the recent lows on the January contract at 37.01/36.95. In the absence of any serious downward pressure resistances should be in sight in the not so distant future. Part of any long positions is to be liquidated just below 39.07, a range resistance and the daily high on the January contract on November 17. Going flat will make sense when the 34-day contract M/A is in sight.

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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.