Oil falls as $80 target comes into play

Daily Market Analysis for Monday 04/15/2013

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.
    • June Brent Crude continued to move lower towards the end of the trading week as expected while once again closing below the weekly SBB and right on the major term support trendline that has captured every IT low since Q3 2009.
    • As the market made new 8 ½ month lows on Friday, the settlement above the daily mid-range suggests that Monday should see a little backing and filling before moving below $100 and toward my quarterly objective of $93.27.
  • Projected Daily Range: 2.20
  • Projected Weekly Range: 4.42
  • Projected Monthly Range: 6.72

WTI Crude Oil (May ‘13):

  • Short Term Trend is bearish.
  • Confirmation of a top with a range violation on 04/09/13 @ 93.05. Confirmation of a top with a close violation on 04/09/13 @ 91.91. Downside Targets = 88.75 – 87.54.
  • Confirmation of a top with a range violation @ 93.05. Confirmation of a top with a close violation @ 91.91.
    • May WTI Crude Oil dropped sharply lower in Friday’s trading session as it threatened the March lows at $90 and posted the second lowest weekly settlement of 2013.
    • As previously suggested in both the weekly and quarterly report, traders should expect WTI to continue to falter in the early stages of Q2 as it works lower to break the Q4 2012 lows and threatens the $80 mark.
  • Projected Daily Range: 1.97
  • Projected Weekly Range: 3.78
  • 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 Friday @ 4.264.
    • May Natural Gas barreled higher again throughout this past week, closing outside the weekly RBB for the fifth consecutive trading week and making new spot contract highs dating back to late July 2011.
    • Continuing pulls from storage widen the gap between current storage levels compared to the five-year average that is driving prices higher on this parabolic move to the upside. The price action from the end of the trading week suggest that there will be an initial move higher in early trading this coming week before facing any resistance near $4.30.
  • Projected Daily Range: .129
  • Projected Weekly Range: .260
  • 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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