Natural gas looks higher after inventories draw

Daily Market Analysis for Friday 04/12/2013

KEY TERMS

OVB      Outside Vertical Bar
VRCB   Volatility Reduced Compression Bar

ENERGIES

Brent Crude Oil (May ‘13):

  • Short Term Trend is bearish.
  • Confirmation of a top with a range violation on 04/03/13 @ 109.37. Confirmation of a top with a close violation on 04/03/13 @ 109.37. Downside Targets = 105.41 – 103.38.
    • May Brent Crude sold off sharply lower on Thursday as it challenged the weekly lows and traded back below $104 while impacting the daily SBB for the sixth time in the last seven trading sessions.
    • Traders should expect a rally back near $105 in early trading on Friday as part of a mild short covering rally before falling back lower as it prepares for its first serious test of sub-$100 oil in nine months.
  • Projected Daily Range: 1.93
  • Projected Weekly Range: 4.80
  • Projected Monthly Range: 6.72

WTI Crude Oil (May ‘13):

  • Short Term Trend is bullish.
  • Confirmation of a bottom with a range violation on 04/09/13 @ 93.76. Confirmation of a bottom with a close violation on 04/09/13 @ 94.20. Upside Targets = 95.23 – 96.15.
    • May WTI Crude Oil dropped from the opening moments of the session throughout the rest of trading on Thursday while settling in the lower 25% of the daily trading range.
    • The WTI market has followed through so far this week on my call for a rally back near $95, and based on Thursday’s price action the market should see further selling heading into the weekend as it challenges the weekly lows and sets up for a drop near the March and current 2013 lows.
  • Projected Daily Range: 1.54
  • Projected Weekly Range: 4.08
  • Projected Monthly Range: 7.11

Natural Gas (May ‘13):

  • Short Term Trend is bullish.
  • Confirmation of a bottom with a range violation on 04/05/13 @ 3.986 Confirmation of a bottom with a close violation on 04/05/13 @ 4.045. Upside Targets = 4.193 – 4.238.
  • New highs made on the current move Thursday @ 4.185.
    • May Natural Gas rebounded from an early session decline on Thursday following a draw from inventories placing current storage levels below the five-year average for this time of year as the market closed at its highest level on this contract.
    • A late session push higher has natural gas likely looking to make new highs on Friday once again as it pushes through both short and intermediate term resistance Bollinger Bands.
  • Projected Daily Range: .125
  • Projected Weekly Range: .229
  • Projected Monthly Range: .580
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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