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Wait-and-see today

Published Friday, June 24th, 2016

Introduction. Today is not the day when a technician should pretend that he or she knows nothing about fundamentals. The consequences of the result of the EU referendum is there for everyone to see. After a day full of optimism the market made a 180 degree U-turn. Resistances were closed above yesterday but the energy market is sharply lower this morning. The daily short and medium-term M/As are all acting now as resistances and the daily slow stochastics are flipping south. The technical picture is gloomy, however, there is no need to turn unreservedly bearish just yet. The initial market reaction is completely understandable. Longs ran for the exit the moment the referendum result became obvious. We could see more long liquidation in the coming hours but it is only wise to wait for the dust to settle to decide whether a new downtrend is about to develop.

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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.