Technically Speaking
Darin Newsom DTN Senior Analyst

Saturday 08/09/14

Energy Markets: Weekly Analysis

Brent Crude Oil: The spot-month contract closed $0.18 higher. The secondary (intermediate-term) trend remains down. However, the spot-month contract is holding above support between $104.62 and $013.61, prices that mark the 61.8% and 67% retracement levels of the previous uptrend from $96.75 through the high of $117.34. Weekly stochastics are nearing the oversold level of 20%, while the nearby futures spread has stabilized at a contango of about $0.60.

Crude Oil: The spot-month contract closed $0.23 lower. The secondary (intermediate-term) trend remains down. However, the spot-month contract held support near $96.73, a price that marks the 675 retracement level of the previous uptrend from $91.24 through the high of $107.73. Weekly stochastics are nearing the oversold level of 20%, but indicating more pressure in the market is likely.

Distillates: The spot-month contract closed 1.08cts higher. The spot-month contract posted a bullish outside week with Friday's close, indicating the secondary (intermediate-term) trend may have turned up. If so, this would confirm a bullish crossover by weekly stochastics all the way back to the week of November 11, 2013. Since then the trend has been sideways. Weekly stochastics at Friday's close were holding just above the oversold level of 20%.

Gasoline: The spot-month contract closed 0.94ct higher. The spot-month contract held its test of support at $2.7134, a price that marks the 67% retracement level of the uptrend from $2.4945 through the high of $3.1520. Weekly stochastics have dipped below the oversold level of 20%, setting the stage for a possible bullish crossover if the spot-month contract consolidates above its technical support. This could soon establish a move to a secondary (intermediate-term) uptrend.

Natural Gas: The spot-month contract closed 16.4cts higher. The spot-month contract is in position to establish a bullish island-reversal, needing only a bullish breakaway gap when the market opens this coming week. Weekly stochastics are below 20%, but not comfortably so for the establishment of a bullish crossover. If the spot-month contract were to post a strong rally next week, stochastics would likely see a crossover above the 20% line, technically keeping the sideways trend intact.

Posted at 9:05AM CDT 08/09/14 by Darin Newsom
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