Technical & Fundamental Oil Reports Specialists

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Vulnerable to a move to the recent lows. Watch the s/t MAs.

Published Wednesday, February 24th, 2016

Introduction.  The failure at resistance on the “springboard” move higher over the last two days has now made lower numbers and tests of support likely. The market is in danger of now making a move through supports – the “trapdoor” – and seeking out lower numbers probably to the recent lows. Heat was the only contract to close below all the s/t MAs last night, and the action this morning has caused WTI, RBOB, and Gasoil to move below these s/t MAs too. “Trapdoor” moves are made when the contracts have been in a range and the s/t MAs are clustered together acting as support. When these s/t MAs are moved below the contracts normally head for the bottom end of the range and recent range lows. This is the danger that the contracts are now in – moves confirmed by close (m/c) below the s/t MAs makes lower numbers very likely. In addition the daily stochastics are turning negative, and Heat is displaying bearish divergence.

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Posted by Robin Bieber