Dec. 20,2006 — With inventories full and mild weather forecasted for the 3rd week of December prices are pressured to the downside across the entire energy complex. Unleaded gas and heating oil have developed trend-reversing patterns, which hint at a market reversal to higher prices in both markets. Crude oil is trading at the top of its three-month trading range. While the Natural gas market is defined by choppy and trend less trade with a bearish bias.
January crude oil
A close above $63.85 resistance should embolden the bulls and target $65.00 plus. A close below $61.14 alerts for a test of key support at $60.12.
January heating oil
The market formed a 1-2-3 trend-reversing pattern and closed above the #2 point (1.8070) on November 29, which could have triggered a buy signal. Keep your stops. A dip below 1.6870 nullifies the formation.
January unleaded gas
The market has formed a 1-2-3 trend-reversing pattern and closed above the #2 point on November 21, which could have triggered a buy signal. Keep your stops. A close above 171 positions the market for further advances targeting 176 resistance. A close below 16246 cautions for pressured dips to 16000 support.
January natural gas
The market is bearish. Friday’s close under 7438 projects further declines to 7000 support. A close over 7920 is needed to halt bear forces and send recovery trade to attack 8304 resistance for a turn to higher prices.
Ralph D. Preston IIIHeritage West Financial, Inc.(858) 560-2646( 800) 263-3004(858) 560-0704 faxrpreston@heritagewestfutures.comwww.heritagewestfutures.com
Past performance is not necessarily indicative of futures results.The risk of loss is present in trading futures and options.
