Oil works lower as fiscal cliff uncertainty continues

Daily Market Analysis (SHORT TERM) Friday 12/14/2012


KEY TERMS

OVB       Outside Vertical Bar
VRCB    Volatility Reduced Compression Bar

ENERGIES

Brent Crude Oil (February ‘13):

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range violation on 12/12/12 @ 107.53. Confirmation of a bottom with a close violation on 12/12/12 @ 108.02. Upside Targets = 110.67 – 111.37
  • February Brent Crude generated a daily bearish close reversal on Thursday as a mass shedding of risk markets across the board pushed prices back to where they began the week.
  • Brent should make a move back a shade higher on Friday near the $108 mark as the sideways holding pattern continues heading into next week.
  • Projected Daily Range: 1.70
  • Projected Weekly Range: 4.73
  • Projected Monthly Range: 9.03

WTI Crude Oil (January ‘13):

  • Short Term Trends are bullish.
  • Confirmation of a top with a range violation on 12/05/12 @ 87.56. Confirmation of a top with a close violation on 12/06/12 @ 86.26. Downside Targets = 85.59 – 85.16.
  • January WTI Crude Oil generated an inside compression day on Thursday with extremely low volatility as it too was dropped to back to unchanged on the week.
  • The oil markets have been stuck in a state of limbo over the past six weeks and until a resolution to the U.S. fiscal cliff crisis appears, this market will continue to work sideways and lower until the end of the year.
  • Projected Daily Range: 1.59
  • Projected Weekly Range: 4.38
  • Projected Monthly Range: 8.74

Natural Gas (January ‘13):

  • Short Term trend is bearish.
  • Confirmation of a top with a range violation on 11/28/2012 @ 3.840. Confirmation of a top with a close violation on 11/28/2012 @ 3.801. Downside Targets = 3.746 – 3.708.
  • New lows made on current move Thursday @ 3.293.
  • January Natural Gas fell even lower on Thursday after a small build in supply inventory but held the pit-session lows on a retest and rallied to finish the day at the mid-range.
  • With a range violation above Thursday’s high, natural gas could begin to see stochastic and rate of change measurements shift to bullish for a one week push higher to a minimum objective of $3.615.
  • Projected Daily Range: .100
  • Projected Weekly Range: .287
  • Projected Monthly Range: .557

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