Natural gas recovers after burst of cold weather before inventories

Daily Market Analysis for Wednesday, 05/15/2013

KEY TERMS

OVB      Outside Vertical Bar
VRCB   Volatility Reduced Compression Bar

ENERGIES

Brent Crude Oil (July ‘13):

  • Short Term Trend is bearish.
  • Confirmation of a bottom with a range violation on 04/20/13 @ 100.34. Confirmation of a bottom with a close violation on 04/20/13 @ 100.39. Upside Targets = 106.40 – 108.61.
  • VRCB generated on Tuesday.
    • July Brent Crude traded within its most narrow range in over 2 months on Tuesday as the consolidation around the $102 mark continued as the market has shown support near the 20-day moving average over the last three trading sessions.
    • Should Brent hold the current lows of the week and trade back above Tuesday’s high, expect for the market to rally back above $105 and continue on toward $107.64.
  • Projected Daily Range: 1.88
  • Projected Weekly Range: 4.83
  • Projected Monthly Range: 9.59

WTI Crude Oil (June ‘13):

  • Short Term Trend is bearish.
  • Confirmation of a bottom with a range violation on 05/03/13 @ 94.26. Confirmation of a bottom with a close violation on 05/01/13 @ 94.26. Upside Targets = 97.92.
    • June WTI Crude Oil dropped sharply lower on Tuesday, marking its fourth consecutive day of lower closes and its lowest settle in eight trading sessions as it nears the 20- and 50-day moving averages.
    • WTI should move higher in initial trading before Wednesday’s EIA storage report as it has been oversold in the short-term and is due for a rally back near $95.
  • Projected Daily Range: 2.01
  • Projected Weekly Range: 5.30
  • Projected Monthly Range: 8.93

Natural Gas (June ‘13):

  • Short Term Trend is bearish.
  • Confirmation of a bottom with a range violation on 05/14/13 @ 4.021. Confirmation of a bottom with a close violation on 05/14/13 @ 4.024. Downside Targets = 3.988 – 3.895.
    • June Natural Gas moved higher throughout much of Tuesday’s trading session following a burst of cold air in the upper Midwest and northeast portions of the country to settle above $4 in over a week and just between the 10- and 50-day moving averages.
    • Wednesday could see some follow through buying in the market push to as high as $4.07 heading into Thursday’s storage report where injections estimates as high as low triple digits could force the market back lower.
  • Projected Daily Range: .103
  • Projected Weekly Range: .316
  • Projected Monthly Range: .570
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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