Crude Oil futures (NYM.CL) rallied a second 'big' day in a row, gaining 3.1% following Friday's 3.4% gain, to close at a record $119.97 after trading as high as $120.30. Other energy futures rallied strongly as well: Natural Gas (NYM.NG) futures gained a 'big' 3.7%, Heating Oil (NYM.HO) gained a 'big' 2.7% (second 'big' gain in a row), and RBOB Gasoline futures (NYM.RB) gained 2.9%. What's the historical significance of such strength in the energy futures market across the board?
Q: How have crude oil futures performed in the past when natural gas futures gain more than 3.0%, heating oil gains more than 1.0%, or gasoline futures gain more than 1.0%, omitting any repeat occurrences within 3 months?
A: According to the 13 previous occurrences of this event, EventEdge indicates that NYM.CL has shown a very strong bullish edge that peaks 74 trading days after the event. Thus, the projected date for the peak of the bullish edge relative to the current event date (Monday, May 5, 2008) is Tuesday, August 19, 2008. NYM.CL rallies in 100% of the cases (13 of 13) by an average of 16.8% relative to the close on the event date. The overall return of the 13 cases is 16.8%, which, based on the close of NYM.CL on the event date ($119.97), provides a target price of $140.12.
To see this idea in our EventEdge® analysis tool click here .
Anthony Kolton is president of Logical Information Machines and Markethistory.com
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