Natural gas rally ignores fundamentals, targets $3.41

Daily Market Analysis (SHORT TERM) Friday 09/28/2012


KEY TERMS

OVB       Outside Vertical Bar
VRCB    Volatility Reduced Compression Bar

ENERGIES

Brent Crude Oil (November):

  • Short Term Trends are bearish.
  • Confirmation of a bottom with a range violation on 09/27/12 @ 111.71. Confirmation of a bottom with a close violation on 09/27/12 @ 112.01. Upside Targets = 117.56 – 120.17.
  • November Brent Crude rocketed higher during Thursday’s trading while once again increasing the spread between itself and WTI and made new six-day highs in the process.
  • Look for Brent to extend its gains going into the weekend, albeit in a subdued trading day, as the current price action indicates that next week could propel Brent price back near the September highs at $117.95.
  • Projected Daily Range: 2.21
  • Projected Weekly Range: 6.09
  • Projected Monthly Range: 13.05

WTI Crude Oil (November):

  • Short Term Trends are bearish.
  • Confirmation of a top with a range violation on 09/19/12 @ 94.97. Confirmation of a top with a close violation on 09/19/12 @ 94.27. Downside Targets = 89.28 – 86.44.
  • C > HOLB (Close Above High Low Bar) generated on Thursday. Possible confirmation of a bottom @ with a range violation 92.40. Possible confirmation of a bottom with a close @ 92.40 or higher.
  • November WTI Crude Oil charged higher on Thursday as value buyers were eager to pick the market up after a near $12 correction and breaking the $90 threshold.
  • Expect a strong finish to the week in WTI as it builds on Thursday’s momentum to challenge the highs of the week before running into further resistance above $94 next week.
  • Projected Daily Range: 2.51
  • Projected Weekly Range: 5.76
  • Projected Monthly Range: 10.76

Natural Gas (November):

  • Short Term Trend is bearish.
  • Confirmation of a bottom with a range violation on 09/24/12 @ 3.080. Confirmation of a bottom with a close violation on 09/25/12 @ 3.105. Upside Targets = 3.211 – 3.283.
  • New 8 week highs made on current move Thursday @ 3.318. Upside Targets over 105% achieved
  • November Natural Gas disregarded the large storage injection on Thursday as the market exploded after the report to generate new 2012 spot contract highs.
  • With fundamentals clearly having little impact in this market, the technical trade should continue to perform well and move higher toward the Intermediate Term objective of $3.416 and new November contract highs.
  • Projected Daily Range: .120
  • Projected Weekly Range: .297
  • Projected Monthly Range: .665

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