- Big gains in nearby positions resulted in forward premium narrowing. There were rumours of unavailability of tank space for tenders, forcing some short coverings. Sentiment is turning positive on seasonal strength from declining production in coming months. However bearish nearby fundamentals, with record high stocks expected in Dec, may cap the upside. Market look likely to trend sideways to higher.
- Technical view - Indicators are positive. The overbought situation indicated in the stochastic may bring some downward correction which should be buy opportunity.
- The final leg of the expanded triangle (wave c of (e)) is developing into a 5-wave structure stretching up to the extreme of upper triangle line, hinting the correction phase is coming to an end. The final subwave of c of (e) may further develop into a rising wedge before FCPO starts to dive in.
- As far as spot month (Mar19) is concerned, the overall correction of wave 4 takes in the form of ending diagonal.
- It is worth to note that EW invalidation level @ 2137 is violated. It indicates that the next major downtrend may be limited to a certain extent.
- We will see what market offers today.
Disclaimer: This only for education purpose. Not a buy call or sell call from us.
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