Natural gas looks for rally after closing unchanged

Daily Market Analysis for Wednesday 03/06/2013

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 = 111.07 – 110.67.
  • C > HOLB generated on Tuesday.
    • April Brent Crude exploded higher in the latter portion of trading on Tuesday, closing at its highest level in four sessions after being much overdue for a volatility pop higher.
    • Look for Tuesday’s rally to fizzle early and retest the $111 mark where it may find some support if this is to be a possible ST bottom.
  • Projected Daily Range: 1.56
  • Projected Weekly Range: 4.57
  • Projected Monthly Range: 6.89

WTI Crude Oil (April ‘13):

  • Short Term Trends are bearish.
  • Confirmation of a top 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 = 91.69 – 90.30.
  • VRCB generated on Tuesday.
    • April WTI Crude Oil moved higher in a limited trading range on Tuesday because there was a risk-on sentiment with the stock market making new all-time highs to help push the market slightly higher.
    • This type of price action is usually indicative of a bottoming formation, but because of the recent damage done to the crude market, there will need to be a retest of the recent lows that hold to confirm strength.
  • Projected Daily Range: 1.49
  • Projected Weekly Range: 4.20
  • Projected Monthly Range: 6.69

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 Tuesday @ 3.594.
    • April Natural Gas traded exceedingly higher for all but the last 10 minutes on Tuesday before dropping from its highest to make new lows on the session and settle unchanged on the day.
    • Look for a little rally to begin Wednesday’s trading and then follow through selling to drop the market back near Monday’s mid-range and lower to challenge the weekly lows.
  • Projected Daily Range: .099
  • Projected Weekly Range: .206
  • Projected Monthly Range: .504
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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