Natural gas rising fast, targeting $3.285

Daily Market Analysis (SHORT TERM) Thursday 06/28/12


KEY TERMS

OVB       Outside Vertical Bar
VRCB    Volatility Reduced Compression Bar

ENERGIES

Brent Crude Oil (August):

  • Short Term Trends are bearish.
  • Confirmation of a bottom with a range violation on 06/26/12 @ 91.76. Confirmation of a bottom with a close violation on 06/26/12 @ 93.02. Upside Target = 95.37.
  • New highs made on current move Wednesday @ 93.95. Upside Target over 115% achieved.
  • August Brent Crude continued to move higher on Wednesday after a modest draw in crude oil inventories was able to keep the market lifted throughout the day.
  • Brent is now within $1.50 of where we expect this market to run into serious resistance and begin to flatten out to the side before returning lower to test the contract lows.
  • Projected Daily Range: 2.32
  • Projected Weekly Range: 8.04
  • Projected Monthly Range: 11.82

WTI Crude Oil (August):

  • Short Term Trends are bearish.
  • Confirmation of a bottom with a range violation on 06/27/12 @ 80.69. Confirmation of a top with a close violation on 06/20/12 @ 81.45. Upside Targets =  82.56 – 83.56
  • Possible confirmation of a bottom with a close @ 80.69 or higher.
  • August WTI Crude churned out its second consecutive daily gain on Wednesday as it closed at its highest level over the past 5 trading sessions.
  • WTI should be able to generate new highs on Thursday before it begins to run into heavy resistance at the double bottom at 81.39 – 81.53.
  • Projected Daily Range: 2.07
  • Projected Weekly Range: 6.48
  • Projected Monthly Range: 11.27

Natural Gas (August):

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range and close violation on 06/14/12 @ 2.535.
  • Bearish ERVB (Extended Range Vertical Bar) generated on Wednesday after making new highs on the current move @ 2.975.
  • August Natural Gas exploded higher in early trading on Wednesday as it blew out remaining shorts in the market, flirting with the $3 threshold, then dropping nearly $.20 in the last two hours of pit session trading.
  • Based on today’s close, this market should technical correct lower to $2.563 over the next few weeks but initiating short positions against both the Short Term and a newly reversed Intermediate Term trend is a risky play.
  • Our advice would be to jump onboard the next buy entry as the market should then crack through $3 and challenge the Major Term upside target of $3.285.
  • Projected Daily Range: .149
  • Projected Weekly Range: .288
  • Projected Monthly Range: .490

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