Natural gas explodes higher to start new week

Daily Market Analysis for Tuesday 02/26/2013

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 top with a range violation on 02/20/13 @ 116.27. Confirmation of a top with a close violation on 02/20/13 @ 115.60. Downside Targets = 113.47 – 112.27.
  • Bearish OVB generated on Monday making new lows on the current move @ 113.31.
  • April Brent Crude lost all of its early momentum on Monday afternoon as Italian election results were less than desirable to most members of the EU and the market dropped more than $2.50 from its overnight highs.
  • Brent should make new lows for the week and current move on Tuesday followed by a short-covering rally back near the $115 mark before meeting further resistance.
  • Projected Daily Range: 1.91
  • Projected Weekly Range: 3.94
  • Projected Monthly Range: 6.75

WTI Crude Oil (April ‘13):

  • Short Term Trends are bearish.
  • 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 = 95.24 – 94.39.
  • Bearish OVB generated on Monday making new lows on the current move @ 92.07.
  • April WTI Crude Oil followed in the footsteps of the other risk markets on Monday in the second half of the day around the Italian election results to settle below the daily SBB.
  • WTI has now given back all of its gains for the year in just the last six trading sessions and should continue to fall over the coming weeks to test the sub-$90 level before strong support comes back into the market.
  • Projected Daily Range: 1.91
  • Projected Weekly Range: 3.64
  • Projected Monthly Range: 6.42

Natural Gas (April ‘13):

  • Short Term trend is bearish.
  • Confirmation of a bottom with a range violation on 02/20/13 @ 3.337. Confirmation of a bottom with a close violation on 02/22/13 @ 3.349. Upside Targets = 3.447 – 3.511.
  • New highs made on current move Monday @ 3.477.
  • April Natural Gas gapped higher in overnight trading to begin the week Sunday evening and never looked back, continuing to extend its gains into the close of trading as it neared the daily resistance Bollinger Band.
  • While Monday’s strong bullish price action and rate of change, it should try to bump up against $3.50 in early trading Tuesday before settling back down and filling the close gap left by the end of the week.
  • Projected Daily Range: .087
  • Projected Weekly Range: .201
  • Projected Monthly Range: .492
About the Author
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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