Oil looking for a setback, strong support at $104

Daily Market Analysis for Tuesday, 08/06/2013

KEY TERMS

OVB      Outside Vertical Bar

VRCB   Volatility Reduced Compression Bar

ENERGIES

Brent Crude Oil (September ‘13):

  • Short Term Trend is bullish.
  • Confirmation of a bottom with a range violation on 08/01/2013 @ 107.90. Confirmation of a bottom with a close violation on 06/27/2013 @ 102.82. Upside Targets = 111.27 – 112.65.
  • Possible partial confirmation of a top with a range violation @ 107.54. Possible confirmation of a top with a close violation @ 107.54 or lower.
    • September Brent Crude rebounded from its early session losses to close back above the daily mid-range as it continues to outpace WTI even in the presence of bearish price action.
    • Following last week’s bullish OVB formation, Brent found support right where it was expected near the previous week’s mid-range and traders should expect that support above $107 to hold once again on Tuesday as it looks to follow through and likely make new highs for the quarter.
  • Projected Daily Range: 1.91
  • Projected Weekly Range: 4.28
  • Projected Monthly Range: 9.49

WTI Crude Oil (September ‘13): (NYMEX:CLU13)

  • Short Term Trend is bullish.
  • Confirmation of a bottom with a range violation on 08/01/2013 @ 105.44. Confirmation of a bottom with a close violation on 08/01/2013 @ 107.89. Upside Targets =  110.03 – 111.87
  • Possible partial confirmation of a top with a range violation @ 105.69. Possible confirmation of a top with a close violation @ 105.69 or lower.
    • September WTI Crude Oil dropped lower throughout Monday’s trading to settle lower for the second straight day and set the stage for a possible short-term TREND REVERSAL from bullish to bearish with a daily close below Monday’s low.
    • While WTI is in need of a near term setback so that the market can resume a healthy rally on its next up leg, there is a lot of support built into this market just below $104 and there would need to be heavy technical damage done this week to break through the previous week’s low.
  • Projected Daily Range: 2.15
  • Projected Weekly Range: 5.04
  • Projected Monthly Range: 9.13

Natural Gas (September ‘13): (NYMEX:NGU13)

  • Short Term Trend is bearish.
  • Confirmation of a top with a range violation on 07/26/2013 @ 3.611. Confirmation of a top with a close violation on 07/26/2013 @ 3.563. Downside Targets = 3.4333.383
  • VRCB generated on Monday making new lows on the current move @ 3.309.
    • September Natural Gas broke through to new lows on Monday in another tight trading session as the market followed through on last week’s bearish price action but closed back above the daily SBB.
    • Natural gas appears to be reaching a point of equilibrium after falling for the 10th time in the last 12 trading sessions and will likely see a mid-week pop higher before turning back to the downside.
  • Projected Daily Range: .097
  • Projected Weekly Range: .246
  • Projected Monthly Range: .548
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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