Natural gas risks sell-off after failing to hold $4

Daily Market Analysis for Tuesday 03/26/2013

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.
  • OVB generated on Monday after making new lows on the current move @ 106.80.
    • May Brent Crude saw one of its most volatile trading sessions in quite some time on Monday as the market yo-yoed up and down throughout the session before eventually settling higher on the day.
    • Look for a move back lower in early trading near $107.50 before finding some ST support and testing the highs from Monday.
  • Projected Daily Range: 1.67
  • Projected Weekly Range: 3.72
  • Projected Monthly Range: 6.89

WTI Crude Oil (May ‘13):

  • Short Term Trends are bearish.
  • Confirmation of a bottom with a range violation on 03/25/13 @ 93.95. Confirmation of a bottom with a close violation on 03/07/13 @ 92.03. Upside Targets = 95.35 – 96.41.
  • Confirmation of a bottom with a range violation @ 93.95.
    • May WTI Crude Oil once again narrowed the spread between itself and Brent on Monday as it closed at its highest level in more than a month while breaking through the daily resistance Bollinger Bands.
    • WTI should continue to rise over the coming week as mentioned in my weekend report before encountering its first sign of resistance above $97.
  • Projected Daily Range: 1.75
  • Projected Weekly Range: 3.15
  • Projected Monthly Range: 6.69

Natural Gas (May ‘13):

  • Short Term trend is bullish.
  • Confirmation of a top with a range violation on 03/25/13 @ 3.913. Confirmation of a top with a close violation on 03/25/13 @ 3.888. Downside Targets = 3.747 – 3.671.
  • Confirmation of a top with a range violation @ 3.913. Confirmation of a top with a close violation @ 3.888.
    • May Natural Gas dropped lower toward the end of trading on Monday as it was unable to establish a bid above $4 to crash through the previous week’s low.
    • This type of price action along with a likely smaller than expected pull from storage over the past week should prompt a sell-off that will signal a drop near $3.75.
  • Projected Daily Range: .120
  • Projected Weekly Range: .243
  • 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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