Natural gas setting up for fall to $2.48

Daily Market Analysis (SHORT TERM) Wednesday 09/05/12


KEY TERMS

OVB       Outside Vertical Bar
VRCB    Volatility Reduced Compression Bar

ENERGIES

Brent Crude Oil (October):

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range violation on 08/31/12 @ 113.45. Confirmation of a bottom with a close violation on 08/31/12 @ 114.57. Upside Target = 122.19 – 124.11.
  • Bearish OVB generated on Tuesday after making new 3+ month highs @ 116.65.
  • October Brent Crude initially started the week higher as it made highs on the current move before running into stark resistance at the daily RBB and dropped nearly $3 lower to close back below $115.
  • Look for Brent to continue a shade lower on Wednesday to trade down possibly below $113 and then find support and finish the session off strong.
  • Projected Daily Range: 2.41
  • Projected Weekly Range: 5.44
  • Projected Monthly Range: 1305

WTI Crude Oil (October):

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range violation on 09/04/2012 @ 96.93. Confirmation of a top with a close violation on 08/30/2012 @ 94.62. Upside Targets = 100.04 – 101.56.
  • Possible confirmation of a bottom with a close violation @ 96.93 or higher.
  • October WTI Crude Oil moved back lower during Tuesday trading on the heels of a lower than expected ISM Mfg Index reading as well as a sharp decline in construction spending.
  • Overall we still expect this market to be good after trading back below near the lower 25% of last week’s trading range and trading out to the side for most of the day’s action, setting up for a possible move back to $97 on Wednesday.
  • Projected Daily Range: 2.16
  • Projected Weekly Range: 5.04
  • Projected Monthly Range: 10.76

Natural Gas (October):

  • Short Term Trend is bearish.
  • Confirmation of a bottom with a range violation on 08/31/2012 @ 2.768. Confirmation of a bottom with a close violation on 08/31/2012 @ 2.799. Upside Targets = 2.836 – 2.915.
  • New highs made on current move Tuesday @ 2.888. Upside Targets 85% achieved.
  • October Natural Gas continued higher to open the week on Tuesday as speculators continue to bid the market higher on the possibility of supply disruptions from Hurricane Isaac as it traded through our first upside objective.
  • Expect natural gas to stall just below $2.95 ahead of Thursday’s EIA report and should the fundamentals align with the technical indicators, this market could fall as low as $2.485 in the coming weeks.
  • Projected Daily Range: .119
  • Projected Weekly Range: .185
  • Projected Monthly Range: .665

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