Today we would like to focus your attention to the Personal Composite Instrument (PCI) &Brent_WTI on the H4 chart. The instrument reflects price movements of a portfolio composed of two oil futures: Brent in the base part and WTI in the quoted part. In fact, this PCI is a price spread between European and American oil. As widely known, oil prices started to slide in the middle of last year and it was caused by a sharp rise in US shale oil production, meanwhile the production in other regions of the world was maintained at the same pace. WTI was sagging lower much faster than Brent. Earlier this year &Brent_WTI has soared, reflecting the oil trends. The spread between the two types of crude oil increased greatly from its historical values. As there is little difference between them, we don’t exclude reducing of the price spread and PCI sliding. You can import &Brent_WTI PCI into NetTradeX from our website.
&Brent_WTI broke the uptrend support level on the H4 chart. Bollinger bands have already started to widen, but the price has not reached the lower band yet. Note the reduced volatility on the MACD chart: it is below the zero level and the signal line which can be considered a bearish signal. The RSI indicator is going down, but hasn’t reached the oversold level yet. We do not rule out the bearish momentum being developed after the last &Brent_WTI candlestick will close below the lower Bollinger band, which is currently the level at 1.166. Another entry point may be considered the previous uptrend line which acts as the resistance line. Of course, you should go short in case there is no resistance level breakout at 1.199. Stop loss is to be placed at the last Parabolic point, which can now act as the resistance line at 1.232. After pending order placing, Stop loss is to be moved every four hours near the next fractal high, following Parabolic and Bollinger bands signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets stop loss level without reaching the order, we recommend cancelling the position: market sustains internal changes which were not considered.
- Position Sell
- Sell stop below 1.166
- Stop loss above 1.232
Recommended Content
Editors’ Picks
USD/JPY briefly recaptures 160.00, then pulls back sharply
Having briefly recaptured 160.00, USD/JPY pulls back sharply toward 159.00 on potential Japanese FX intervention risks. The Yen tumbles amid news that Japan's PM lost 3 key seats in the by-election. Holiday-thinned trading exaggerates the USD/JPY price action.
AUD/USD extends gains above 0.6550 on risk flows, hawkish RBA expectations
AUD/USD extends gains above 0.6550 in the Asian session on Monday. The Aussie pair is underpinned by increased bets of an RBA rate hike at its May policy meeting after the previous week's hot Australian CPI data. Risk flows also power the pair's upside.
Gold stays weak below $2,350 amid risk-on mood, firmer USD
Gold price trades on a softer note below $2,350 early Monday. The recent US economic data showed that US inflationary pressures stayed firm, supporting the US Dollar at the expense of Gold price. The upbeat mood also adds to the weight on the bright metal.
Ethereum fees drops to lowest level since October, ETH sustains above $3,200
Ethereum’s high transaction fees has been a sticky issue for the blockchain in the past. This led to Layer 2 chains and scaling solutions developing alternatives for users looking to transact at a lower cost.
Week ahead: Hawkish risk as Fed and NFP on tap, Eurozone data eyed too
Fed meets on Wednesday as US inflation stays elevated. Will Friday’s jobs report bring relief or more angst for the markets? Eurozone flash GDP and CPI numbers in focus for the Euro.