Oil pops on supply draw, target near $90

Daily Market Analysis (SHORT TERM) Thursday 08/02/12


KEY TERMS

OVB       Outside Vertical Bar
VRCB    Volatility Reduced Compression Bar

ENERGIES

Brent Crude Oil (September):

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range violation on 07/27/12 @ 106.19. Confirmation of a bottom with a close violation on 07/27/12 @ 106.47. Upside Target = 109.88 – 111.83.
  • Bullish OVB generated on Wednesday.
  • September Brent Crude paired its losses from Tuesday as it moved back to challenge the weekly highs as a much larger than expected draw in crude inventories along with escalating tensions with Iran helped fuel daily gains.
  • Picking up Brent below $105.49 should provide a nice daily profit leading into Friday’s all-important NFP report.
  • Projected Daily Range: 2.23
  • Projected Weekly Range: 5.90
  • Projected Monthly Range: 13.99

WTI Crude Oil (September):

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range violation on 07/30/12 @ 90.48. Confirmation of a top with a close violation on 07/23/12 @ 88.14. Upside Targets = 93.58 – 95.53
  • September WTI Crude followed Brent higher on Wednesday as it too was fueled by the EIA storage draw and closed in the upper 70% of the daily range.
  • After finding support over the past few days at the daily mid-Bollinger Band, WTI should be able to trade back near $90 on Thursday.
  • Projected Daily Range: 2.19
  • Projected Weekly Range: 5.20
  • Projected Monthly Range: 11.71

Natural Gas (September):

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range and close violation on 07/30/2012 @ 3.187. Upside Targets = 3.355 – 3.507.
  • Possible confirmation of a top with a range violation @ 3.122. Possible confirmation of a top with a close violation @ 3.122 or lower.
  • September Natural Gas dropped lower on Wednesday against rising oil prices as lead stochastic indicators showing this market being overbought as well as the daily Resistance Bollinger Band forced gas to its lowest settlement of the week.
  • Should natural gas break through Wednesday’s low on Thursday and confirm a Short Term top in the market, gas could drop as low as $2.907 before giving traders another shot to pile into the market.
  • Projected Daily Range: .146
  • Projected Weekly Range: .265
  • Projected Monthly Range: .586

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