Natural gas may be setting up to test $1.90 low

Daily Market Analysis (SHORT TERM) Thursday 06/07/12


KEY TERMS

OVB       Outside Vertical Bar
VRCB    Volatility Reduced Compression Bar

ENERGIES

BRNN12:

  • Short Term Trends are bearish.
  • Confirmation of a bottom with a range violation on 06/06/12 @ 99.64. Confirmation of a bottom with a close violation on 06/06/12 @ 100.64. Upside Targets = 102.65 – 103.67.
  • July Brent Crude rallied to new weekly highs on Wednesday as this market seemed to catch a breath of fresh air in wake of increased possibilities of monetary easing from the Fed.
  • Look for Brent to continue higher towards the weekly upside objective of 102.69 assuming the U.S. has a strong Jobs report.
  • Projected Daily Range: 2.72
  • Projected Weekly Range: 7.06
  • Projected Monthly Range: 11.82

CLN12:

  • Short Term Trends are bearish.
  • Confirmation of a bottom with a range violation on 05/30/12 @ 84.93. Confirmation of a bottom with a close violation on 06/06/12 @ 85.02. Upside Targets =  86.51 – 87.34
  • July WTI Crude rolled higher again on Wednesday after a draw in crude inventories helped the market trade to its highest level this week despite having a weak close.
  • Look for WTI to follow through on yesterday’s report calling for a move this week to 87.50 achieving the full weekly range of 6.29.
  • Projected Daily Range: 2.34
  • Projected Weekly Range: 6.29
  • Projected Monthly Range: 11.27

NGN12:

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range violation on 06/04/12 @ 2.441. Confirmation of a bottom with a close violation on 06/05/12 @ 2.477. Upside Targets = 2.594 – 2.661.
  • Double VRCB generated on Wednesday after making new highs on current move @ 2.487.
  • July Nat Gas traded within another tight range on Wednesday ahead of the Thursday storage report yet closed just below the daily mid-range after failing to crack through $2.50.
  • Due to the strong base that has been built over the past six sessions, should tomorrow’s numbers be bullish, this market should accelerate higher to our first Short Term objective @ 2.594 by day’s end. However, because of the fact we had a Double VRCB this market could be running out of gas setting up to go back and test the low set on 04/20/12 at $1.902.
  • Projected Daily Range: .102
  • Projected Weekly Range: .301
  • Projected Monthly Range: .490

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