C5TC and P4TC Spread Technical Analysis
Freight Investor Services
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After reaching a high of $6,325, the C5TC v P4TC Q125 spread has entered a corrective phase, with prices now trading within the Fibonacci support zone. This shift leaves the spread approaching various interesting technical levels that could influence market direction.
In the near term, the first Fibonacci support level sits at $5,140, representing a 50% retracement. Below this, secondary trend support is found at $4,850, which also coincides with the 61.8% Fibonacci support level. Currently, the daily low (8th October 2024) is aligned with channel support at $5,225, a highlighted zone of interest. If the price closes below this level, the secondary trend support at $ 4,850 may come under pressure, indicating a potential shift in market sentiment.
For market buyers, a key signal of renewed buying pressure would be a close above the upper channel resistance, currently positioned at $5,850, such a move could suggest that buyside pressure is increasing.
From a momentum standpoint, the Relative Strength Index (RSI) is approaching a support area, signalling potential stability. However, caution is advised if the market pulls back and closes below the $4,850 level. Such a move could potentially indicate a shift in the trend dynamics, with selling pressure taking hold and potentially reversing the current bullish sentiment.
The coming days are critical for this spread as it navigates key support levels. Traders should ultimately keep a close eye on price action around $5,140, $4,850, and $ 5,850, as these levels may potentially determine the market's next direction. Momentum indicators like the RSI may further suggest a delicate balance, with the potential for either a bullish breakout or increased downside pressure.
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Author: Edward Hutton , Senior Technical Research Analyst
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