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Downtrend firmly intact. Watch 32.40 on WTI.

Published Monday, January 11th, 2016

Introduction.  The downtrend continues. There was no pre-weekend short covering on Friday. All the contracts managed was a brief rally up to the sellable 5-day M/A resistances before they turned and settled lower on the day. The energy complex is losing further value this morning. The downtrend conditions are in place and some important supports are being put under pressure. Closes below them will keep bears in control of the market. Rallies to resistances are sells. WTI has very important support at 32.40 and 32.10. The former is the low in December 2008 whilst the latter is last Thursday’s low. On a close below this area there is nothing really that could stop this contract falling down to 26.80, the high in December 2006 and to 25.04, the low in June 2003. Watch 32.40/10, this is one of the most important support areas across the board today. Rallies to the 5-day M/A resistance at around 33.74 is still seen as a selling opportunity.

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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.