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Natural gas threatens contract lows after storage miss

Daily Market Analysis for Friday 02/15/2013

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February 15, 2013 • Reprints

KEY TERMS

OVB      Outside Vertical Bar
VRCB   Volatility Reduced Compression Bar

ENERGIES

Brent Crude Oil (April ‘13):

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range violation on 01/15/13 @ 110.39. Confirmation of a bottom with a close violation on 12/12/12 @ 106.48. Upside Targets = 117.89 – 121.21.
  • OVB generated on Thursday making new highs on current move @ 118.29.
    • April Brent Crude once again inched higher in a tight trading session on Thursday, settling right at the $118 mark in what has been an underwhelming week of price action.
    • Look for Friday to remain status quo heading into the weekend as Brent most likely will generate a weekly VRCB and set up for a possible decline lower next week.
  • Projected Daily Range: 1.39
  • Projected Weekly Range: 3.71
  • Projected Monthly Range: 6.75

WTI Crude Oil (March ‘13):

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range violation on 02/13/13 @ 97.80. Confirmation of a top with a close violation on 02/04/13 @ 96.17. Downside Targets = 94.84 – 93.99.
  • Inside VRCB generated on Thursday.
    • March WTI Crude Oil moved just modestly higher on Thursday, following in the footsteps of the other components in the oil sector as it traded within less than a $1 range.
    • With current Bollinger Band ranges contracting as well as a possible partial ST TREND REVERSAL to bearish with a range violation below $96.63, WTI will need to find significant strength with a strong close to avoid a possible ST setback.
  • Projected Daily Range: 1.52
  • Projected Weekly Range: 2.49
  • Projected Monthly Range: 6.42

Natural Gas (March ‘13):

  • Short Term trend is bearish.
  • Confirmation of a top with a range violation on 02/14/13 @ 3.206. Confirmation of a top with a close violation on 02/08/13 @ 3.272. Downside Targets = 3.189 – 3.109.
    • March Natural Gas dropped sharply lower as expected with a miss in storage pulls on Thursday as they impacted the daily SBB (Support Bollinger Band) while threatening the current contract lows.
    • Natural gas is current oversold in the near-term so traders could see an initial move lower followed by a short-covering rally to end the week as cooler weather is appearing in the upcoming weather forecasts.
  • Projected Daily Range: .119
  • Projected Weekly Range: .206
  • Projected Monthly Range: .492
About the Author
Kris Hicks

Kris Hicks

KMH is a trading and technical analysis firm that specializes in commodity futures and commodity based ETF’s. Kris Hicks has worked for numerous years in the commodity business and in 2011 accurately forecasted both $25 moves to the downside in May and July and the $25+ move to the upside in October in oil. He also called the all-time high day for gold on Sept. 6, 2011 and forecasted a projected downside target of 1528.10 in March 2012. He was also responsible for projecting the Q2 and Q4 low in the Euro FX to within 13 and 9 ticks, respectively. His trading methodology has a high degree of accuracy which confirms tops/bottoms, projected trading ranges and projected targets for those ranges. His expertise is focused on 16 commodities plus the comparable ETF markets. You can reach Kris at Kris@KMH-Capital.com or visit his website at www.KMH-Capital.com.

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