Natural gas falls after hitting resistance near $4.30

Daily Market Analysis for Tuesday, 04/16/2013

KEY TERMS

OVB      Outside Vertical Bar
VRCB   Volatility Reduced Compression Bar

ENERGIES

Brent Crude Oil (June ‘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 = 96.77 – 93.27.
    • June Brent Crude opened Monday’s trading session just off the highs and sank lower throughout the remainder of the trading session, never looking back as it cracked the $100 threshold for the first time in nine months.
    • Brent’s acceleration lower over the past few trading sessions suggest that the market may in fact pick up steam during Q2 in terms of volatility as it works its way lower towards my annual downside target of $85.21.
  • Projected Daily Range: 2.57
  • 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.
  • Bearish ERVB generated on Monday. New lows made on the current move Monday @ 87.20.
    • May WTI Crude Oil extended its losses on Monday as the risk markets saw massive liquidation following the collapse in the gold market as it made new 2013 lows.
    • WTI could see a bit of short covering on Tuesday but it should be short lived as it continues to work lower towards my initial Q2 downside objective of $83.06.
  • Projected Daily Range: 2.16
  • 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.
  • Bearish OVB generated on Monday after making new highs on the current move @ 4.290.
    • May Natural Gas saw resistance exactly where suggested below the $4.30 mark before dropping sharply lower as it made new lows for the session going into the last moments of trading.
    • Look for some follow through selling on Tuesday as possible margin calls surface and more liquidation continues and the market makes a test of the minimum downside weekly objective of $4.03.
  • Projected Daily Range: .132
  • 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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