Energy Prices Stuck

On March 21, 2012 by TradingDesk

Energy prices remain stuck in their trading range, albeit modestly lower, after failing to follow through yet again at an early morning sell-off attempt yesterday. Brent Crude is leading refined products into the red, following exemptions to Iranian sanctions granted to 10 nations that lowered their import volumes, which is seen as a temporary reprieve from the constant tensions.

RBOB bounced off of its 14 day moving average for the 3rd time in a week yesterday, and remains above its 4-month old bull trend line. We are only a few cents away from breaking the highs for the year, which sets up a 10 cent run towards last spring’s peak. 3.3868 is the key number. HO looks relatively weak, with some technical studies rolling over into bearish territory and its trend line breaking down last week. Key support for HO comes in around $3.17, with a break below that level targeting $3.05. There are still record amounts of money sitting in the energy contracts, so expect choppy action as traders position themselves anticipating a breakout of our recent range.

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