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PVM Midday Report 04 July 2016

Published Monday, July 4th, 2016

Headlines

  1. Niger Delta Avengers claim responsibly for five separate oil attacks
  2. Speculators slash bullish bets on ICE Brent crude to lowest since February 2016
  3. Libya’s two rival oil companies agree to merge
  4. Eurozone investor sentiment tumbles to an 18-month low – Sentix
  5. UK construction PMI slumps to seven-year low in June

Oil                                                                                              

Fundamentals: Financial managers have taken an axe to bets on rising ICE Brent crude prices with net length falling by 35,708 lots in the week to June 28 which was the largest weekly decline in 11 months. Elsewhere, the Niger Delta Avengers have claimed responsibility for five separate attacks on oil installations that took place late on Sunday night. Meanwhile, in rare bit of good news for the embattled oil producer, Libya’s two rival oil companies have agreed to merge in what is seen as an important step to restoring oil output to pre-crisis levels of around 1.5 mbpd.

Technicals: There have been few developments this morning other than RBOB moving back below the 5 day MA around 151.71. This is an important pivot. Meanwhile the rest are still above all the short term (s/t) MAs, clustered together just below current levels, and there are no targets lower whilst they hold. Moves confirmed by closes (m/c) below would only activate levels lower to either the 55 day MAs or range support. Equally, staying over the s/t MAs suggests putting resistance under pressure. The fact that RBOB is below the 5 day is not overly constructive, but may well prove misleading with the US holiday.

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Posted by Stephen Brennock

Stephen Brennock joined PVM in 2013 after having worked as a project manager for a business development firm. He graduated with a degree in Business Management in 2007.