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Downtrend conditions, but watch RBOB’s 5-day MA

Published Thursday, December 10th, 2015

Introduction.  The trend remains down. There are targets lower on all contracts but RBOB, which hit its objective to 120.24 yesterday and held. The rest have targets lower, valid whilst below the 5 day MAs, on WTI to 35.52; Brent to 39.35; and Heat to 122.10. Jan’ Gasoil needs a move confirmed by a close (m/c) below 371.00 to green light a leg down to 361.50. Keep an eye on RBOB – it may yet spoil the current “bear-fest”. It hit its target to 120.24 and then m/cd over. It is now also above the 5 day MA, around 123.24, and this is contributing to a lack of technical harmony this morning. For the targets lower to look secure RBOB needs to be below the 5 day MA, or there are fears that this could be an early warning signal for a recovery on the rest. As such the 5 day MA around 123.24 is the most important support pivot on the board. In the meantime, the rest of the contracts are below the short term (s/t) MAs and have negative stochastics. Rallies to the 5 day MAs, good sellable resistance on the crudes and RBOB yesterday, are sells, as are the 8s – see RBOB related caveat in paragraphs below. Do not hold shorts on m/cs over the 5s.

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Posted by Robin Bieber