Natural gas sings swan song before fall weather hits

Daily Market Analysis for Friday, 09/13/2013

KEY TERMS

OVB      Outside Vertical Bar

VRCB   Volatility Reduced Compression Bar

ENERGIES

Brent Crude Oil (November ‘13):

  • Short Term Trend is bearish.
  • Confirmation of a top with a range violation on 09/09/2013 @ 113.31. Confirmation of a top with a close violation on 09/09/2013 @ 112.33. Downside Targets = 109.65 – 108.36.
  • Possible partial confirmation of a bottom with a range violation @ 112.18. Possible confirmation of a bottom with a close violation @ 112.18 or higher.
    • November Brent Crude moved modestly higher on Thursday, setting up for a possible ST bottoming formation that would produce yet another higher low and likely lead to new contract highs in the coming weeks.
    • Brent will need to see additional bullish momentum and close above the $112.50 mark on Friday to open up the gates for new buyers to step in that would help drive the market toward the $117 mark.
  • Projected Daily Range: 2.39
  • Projected Weekly Range: 4.61
  • Projected Monthly Range: 8.68

WTI Crude Oil (October ‘13): (NYMEX:CLV13)

  • Short Term Trend is bearish.
  • Confirmation of a bottom with a range violation on 09/12/2013 @ 108.96. Confirmation of a top with a close violation on 09/10/2013 @ 107.39. Downside Targets = 105.76 – 104.53.
  • Partial confirmation of a bottom with a range violation @ 108.96.
    • October WTI Crude Oil moved higher for the second straight day on Thursday as it continues to remain range bound between the $107-$110 areas while the market digests possible Middle East conflict fears.
    • Based on the confirmed price action over the past few sessions, WTI is likely overbought on most intraday charts and should see some backing and filling throughout Friday as it moves between $108 and $110 going into the weekend.
  • Projected Daily Range: 1.99
  • Projected Weekly Range: 5.76
  • Projected Monthly Range: 10.28

Natural Gas (October ‘13): (NYMEX:NGV13)

  • Short Term Trend is bearish.
  • Confirmation of a bottom with a range violation on 08/12/2013 @ 3.327. Confirmation of a bottom with a close violation on 08/14/2013 @ 3.342. Upside Targets = 3.4613.534
    • October Natural Gas moved sharply higher on Thursday despite storage injections being in line with expectations as traders looked to take aim at the previous week’s highs despite cooling demand beginning to wane in most areas of the country.
    • Natural gas will need strong fundamental support for prices to remain at these levels as the market is technically overbought into what should be sturdy resistance in what could be the market’s final swan song before fall weather hits.
  • Projected Daily Range: .103
  • Projected Weekly Range: .210
  • Projected Monthly Range: .497
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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