Contango Flattens, Stocks Build, WTI Overbought.
All in the title. And Fibonacci targets reached. WTI, it was nice while it lasted.
(from last week)
click to enlargeWTI overbought.
click to enlarge
Note the Negative divergence on RSI.
And Fibonacci targets have been reached.
BTW not only was there a .618 retrace of the move down as shown above BUT the nearby month rallied 62% from 26.05
Going way out on a limb....could be a little downside risk here.
Please note that new contract lows in May or June can be made while only giving the nearby month charts a deep pullback, not uncommon in 2 wave's and major pivots.
In fact, the May contract rally has an "abc" corrective look, with the c =1.65 of the a. See above.
With Rbob in a similar chart situation and margins narrow, I would expect less severe a pullback, preserving the gap on the nearby chart. Result; wider margins going forward into driving season.