Technical & Fundamental Oil Reports Specialists

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Bulls got trapped, test of supports are expected

Published Tuesday, January 26th, 2016

Introduction.  We experienced a rather spectacular failure yesterday at resistances as bulls could not capitalise on last Thursday’s and Friday’s rally. Almost all of Friday’s gains were given back and the market is doing its best to give back the advances made on Thursday, too. The 13-day M/As were closed back below on all contracts and the 8 and 5-day M/As are either being put under pressure at the time of writing or have already been broken below this morning. Should they be settled below then the re-visit of the recent lows will be anticipated. Closes below these lows will put bears firmly back behind the steering wheel. The lowest of the daily short-term M/As on WTI is the 5-day currently at 29.97. If it is settled below the contract low of last Wednesday at 27.56 and the recent continuation low at 26.19 will be targeted. Technicals will be neutral between the 5 and 13-day M/As with the latter presently at 31.24 and only a close above the 13-day is somewhat bullish.

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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.