Crude oil faces technical test

Crude still strong but close under $104.29 could reverse trends

Daily Market Analysis (SHORT TERM) Friday 03/23/12

 

KEY TERMS

OVB      Outside Vertical Bar

VRCB   Volatility Reduced Compression Bar

 

ENERGIES

 

BRNK12:

  • Short Term Trends are bullish.
  • Confirmation of a top with a range violation and close below on 03/15/12 @ 124.63. Downside Targets = 120.81-119.63.
    • May Brent Crude moved lower again on Thursday, making new lows for the week before finding some support just below last Friday’s low.
    • Recent economic data abroad has led to lower settlements 3 out of the 4 trading days this week but overall the market has remained resilient as it has been in a consolidation period for the last month.
  • Projected Daily Range: 1.74
  • Projected Weekly Range: 6.17
  • Projected Monthly Range: 10.51

 

CLK12:

  • Short Term Trends are bullish.
  • Confirmation of a top with a range violation on 03/22/12 @ 105.69. Confirmation of a top with a close on 03/22/12 @ 105.35. Downside Target = 103.54.
    • May Crude followed Brent lower today as it broke through the daily Support Bollinger Bands before bouncing off the lows to end the day just above $105.
    • So far WTI avoided generating an OVB week but if, AND ONLY IF, this market cracks through last week’s low @ 104.29, look for an extended sell-off down to$98.98.
  • Projected Daily Range: 2.29
  • Projected Weekly Range: 4.45
  • Projected Monthly Range: 10.26

 

NGK12:

  • Short Term Trends are bearish.
  • Bearish OVB generated on Thursday. Confirmation of a top with a range violation on 03/22/12 @ 2.392. Confirmation of a top with a close on 03/22/12 @ 2.372. Downside Targets = 2.161 – 1.860
    • Nat Gas broke lower on Thursday as there was a storage injection as well as a lack of interest from consumers as the market traded near $2.50.
    • The technical point to this move as another downward leg that could eventually take this market below $2.00 for the first time since September 2001 @ 1.880 low.
  • Projected Daily Range: .082
  • Projected Weekly Range: .222
  • Projected Monthly Range: .690

METALS

 

 

GCJ12:

  • Short Term Trends are bearish.
  • Confirmation of a top on 03/14/12 with a range violation @ 1663.30 and a close below. Downside Targets 1648.90-1612.20. Extreme Projected Downside 1566.10.
  • New lows made on Thursday for the current down move @ 1627.50. Initial Target over 90% achieved.
    • April Gold broke lower overnight and throughout the early morning session as it followed the other risk markets lower before a second half-day rally occurred and the market closed just above its daily mid-range.
    • The Parrish Hicks bias remains cautiously bullish at these levels but will need a strong Friday to confirm our bullish suspicions.
  • Projected Daily Range: 22.80
  • Projected Weekly Range: 80.80
  • Projected Monthly Range: 176.10

 

CURRENCIES

ECM12:

  • Short Term Trends are bullish.
  • Confirmation of a bottom on a range violation on 03/19/12 @ 1.3196. Confirmation of a bottom on a range violation 03/19/12 @ 1.3245. Upside Target 1.3380 – 1.3470.
  • Possible confirmation of a top with a range violation @ 1.3139. Possible confirmation of a top with a close @ 1.3139 or lower.
    • The Euro spent most of the day trading lower before catching a mid-day rally off its lows to settle just below the mid-range of the day.
    • The Euro did however generate its lowest close of the week and has the possibility of generating a bearish head-and-shoulders pattern.
      • More analysis on this formation will ensue upon signal confirmation.
  • Projected Daily Range: .0103
  • Projected Weekly Range: .0228
  • Projected Monthly Range: .0601

 

INDEXES

 

ESM12:  

  • Short Term Trends are bullish.
  • Confirmation of a top on 03/22/12 with a range violation @ 1391.50 and a confirmation of a top with a close @ 1389.00. Downside Target = 1378.00 – 1371.25.
    • The June S&P’s generated new 7 trading day lows on Thursday as the stock market has continued to struggle above the 1400 level.
    • This sell-off, rest assured, is to be short lived and we fully expect this market to resume its current upwards momentum after a brief correction.
  • Projected Daily Range: 14.25
  • Projected Weekly Range: 31.50
  • Projected Monthly Range: 73.50

 

About the Author
Jim Parrish and Kris Hicks

Parrish Hicks Capital Research is a trading and technical analysis firm that specializes in Energy and Metal commodity futures. The two founders, Jim Parrish and Kris Hicks, have a combined 38 years’ experience in the commodity business and in 2011 accurately forecasted both $25 moves to the downside in May and July and the $25+ move to the upside in October. They also called the all-time high day for Gold on September 6, 2011 and forecasted a projected downside target of 1528.10 in March 2012.  Their trading methodology has a high degree of accuracy which confirms tops/bottoms, projected trading ranges and projected targets for those ranges. Their expertise is focused on 16 commodities plus the comparable ETF markets. You can reach them at Jim@ParrishHicks.com and Kris@ParrishHicks.com or at www.ParrishHicks.com.

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