Natural gas targets $3.45 on cold weather forecasts

Daily Market Analysis (SHORT TERM) Monday 01/07/2013


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 top with a range violation on 01/04/13 @ 111.26. Confirmation of a bottom with a close violation on 12/12/12 @ 108.02. Upside Targets = 110.67 – 111.37
  • February Brent Crude dropped lower on Friday to end the week just above Monday’s close and also slightly above the daily mid-range.
  • Brent was able to make an early move higher into the New Year but could not sustain the bullish momentum to trade through the Q4 highs and may set back to the $110 level it has traded around for five months.
  • Projected Daily Range: 1.48
  • Projected Weekly Range: 3.33
  • Projected Monthly Range: 7.54

WTI Crude Oil (February ‘13):

  • Short Term Trends are bullish.
  • Confirmation of a top with a range violation on 01/04/13 @ 91.55. Confirmation of a bottom with a close violation on 12/18/12 @ 88.40. Upside Targets = 90.10 – 90.68.
  • February WTI crude oil reversed course from its early losses to close back just a few ticks off the session’s high.
  • WTI may see a little drop lower in early week trading but find strong support near $92 and then return to make a move back through the $95 resistance level onward to the IT objective of $97.
  • Projected Daily Range: 1.61
  • Projected Weekly Range: 3.74
  • Projected Monthly Range: 7.18

Natural Gas (February ‘13):

  • Short Term trend is bearish.
  • Confirmation of a top with a range violation on 12/26/12 @ 3.362. Confirmation of a top with a close violation on 01/02/13 @ 3.315. Downside Targets = 3.102 – 3.055.
  • February Natural Gas received a nice bounce on Friday following the largest storage draw of the season as it tried to recapture some of the lost ground from Wednesday’s HFT debacle.
  • With this past week bringing cold weather throughout the producing regions as well as the northern parts of the country, look for another large withdrawal and for natural gas to work its way higher back near the $3.45 mark.
  • Projected Daily Range: .129
  • Projected Weekly Range: .274
  • Projected Monthly Range: .492

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