Natural gas building momentum for run to $3.50

Daily Market Analysis (SHORT TERM) Tuesday 01/15/2013

KEY TERMS

OVB       Outside Vertical Bar
VRCB    Volatility Reduced Compression Bar

ENERGIES

Brent Crude Oil (March ‘13):

  • Short Term Trends are bullish.
  • Confirmation of a top with a range violation on 01/11/13 @ 109.13. Confirmation of a bottom with a close violation on 12/12/12 @ 107.17. Upside Targets = 110.67 – 111.37
  • March Brent Crude rebounded nicely from Friday’s sharp drop lower where it made new 2013 lows as it outpaced WTI significantly to increase the spread back to nearly $17.
  • If Brent can continue to push higher this week it could make new 2013 highs and possibly trade to the $115 threshold by mid-next week.
  • Projected Daily Range: 1.86
  • Projected Weekly Range: 3.53
  • Projected Monthly Range: 7.54

WTI Crude Oil (February ‘13):

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range violation on 01/08/13 @ 93.36. Confirmation of a bottom with a close violation on 12/18/12 @ 88.40. Upside Targets = 96.36 – 97.57.
  • February WTI Crude Oil generated new closing highs on the current move Monday to close at its highest level since mid-September.
  • Based on current price action, WTI should trade above $96 by week’s end before breaking through to the IT upside objective of $97.57.
  • Projected Daily Range: 1.48
  • Projected Weekly Range: 3.15
  • Projected Monthly Range: 7.18

Natural Gas (February ‘13):

  • Short Term trend is bearish.
  • Confirmation of a bottom with a range violation on 01/14/2013 @ 3.359. Confirmation of a bottom with a close violation on 01/14/2013 @ 3.373. Upside Targets = 3.583 – 3.628.
  • February Natural Gas gapped higher in overnight trading Sunday evening and broke through the $3.40 mark for the first time in 2013 before dropping off the session’s highs and closing at the daily mid-point.
  • If natural gas is able to continue its bullish momentum higher on Tuesday and close above $3.42, this market could jump drastically as shorts begin to exit and give natural gas room to run up to $3.50.
  • Projected Daily Range: .113
  • Projected Weekly Range: .286
  • Projected Monthly Range: .492

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