Natural gas technical point to possible correction to $3.29

Daily Market Analysis for Wednesday 03/20/2013

KEY TERMS

OVB       Outside Vertical Bar
VRCB    Volatility Reduced Compression Bar

ENERGIES

Brent Crude Oil (May ‘13):

  • Short Term Trends are bullish.
  • Confirmation of a top with a range violation on 03/19/13 @ 107.77. Confirmation of a top with a close violation on 02/20/13 @ 115.60. Downside Targets = 105.66 – 104.57.
  • Confirmation of a top with a range violation @ 107.77.
  • May Brent Crude was unable to follow through on Monday’s rebounding price action as it dropped sharply lower in the second half of trading and made new 2013 lows.
  • Tuesday’s trading may turn out to be a flush-out move to get rid of weak bulls but the price action suggests a further move lower down near the $104.50 level.
  • Projected Daily Range: 1.95
  • Projected Weekly Range: 4.23
  • Projected Monthly Range: 6.89

WTI Crude Oil (May ‘13):

  • Short Term Trends are bearish.
  • Confirmation of a bottom with a range violation on 03/06/13 @ 91.00. Confirmation of a bottom with a close violation on 03/07/13 @ 92.03. Upside Targets = 95.35 – 96.41.
  • New highs made on the current move @ 94.47.
  • May WTI Crude Oil gave back all if its gains from the past week on Tuesday as a sharply declining RBB and a bearish ST rate of change put a halt to the recent $5 rally.
  • WTI should make a move back higher above $93.50 on Wednesday where it will test the resolve of the bears.
  • Projected Daily Range: 1.71
  • Projected Weekly Range: 3.36
  • 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 the current move Tuesday @ 3.973.
  • April Natural Gas rebounded from Monday’s late session decline as it made new highs for the session moving into the close despite the heavily overbought nature of the market along with all technical analysis pointing to a looming correction.
  • Eventually the rate of change will shift decidedly from bullish to bearish and will lead to a dramatic sell-off in the market that should eventually fill the weekly close gap from the April contract all the way back down to $3.291.
  • Projected Daily Range: .105
  • Projected Weekly Range: .259
  • 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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