Oil direction dependent on Fed action

Daily Market Analysis (SHORT TERM) Wednesday 06/20/12

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KEY TERMS

OVB       Outside Vertical Bar
VRCB    Volatility Reduced Compression Bar

ENERGIES

BRNQ12:

  • Short Term Trends are bearish.
  • Confirmation of a top with a range violation on 06/11/12 @ 97.18. Confirmation of a top with a close violation on 06/13/12 @ 96.72. Downside Targets = 92.38 – 90.71.
  • New lows made on current move Tuesday @ 94.44. Downside Targets 80% achieved.
  • August Brent Crude traded down to generate fresh 2012 lows on Tuesday as it traded below $95 for the first time since January of 2011.
  • With Brent settling back above the day’s mid-range, look for this market to edge higher going into the EIA storage report and a Fed announcement in the second half of trading on Wednesday.
  • Projected Daily Range: 2.54
  • Projected Weekly Range: 7.24
  • Projected Monthly Range: 11.82

CLQ12:

  • Short Term Trends are bearish.
  • Confirmation of a bottom with a range violation on 06/14/12 @ 84.30. Confirmation of a bottom with a close violation on 06/15/12 @ 84.33. Upside Targets =  87.32 – 91.12
  • August WTI Crude was able to hold Monday’s lows and close at its highest level in over a week as housing data was mixed but risk markets rose in unison on hopes for additional Fed easing.
  • WTI could see a sharp move higher on Wednesday should the Fed announce an extension of “operation twist” or additional QE but a lack of support from Chairman Bernanke could put the downside technical targets of $77.59 in play this week.
  • Projected Daily Range: 2.35
  • Projected Weekly Range: 6.60
  • Projected Monthly Range: 11.27

NGN12:

  • Short Term Trends are bullish.
  • Confirmation of a top with a range and close violation on 06/07/12 @ 2.312.
  • New highs made on current move Tuesday @ 2.671. Upside Targets over 100% achieved.
  • July Nat Gas reversed back lower in Tuesday trading after making new highs on the current move as it failed to continue higher within distribution zone created during late May.
  • Based off of Tuesday’s price action, natural gas should retrace back near $2.60 during intraday trading before heading out the bottom to retest the weekly lows @ 2.459.
  • Projected Daily Range: .159
  • Projected Weekly Range: .264
  • Projected Monthly Range: .490

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