Technically Speaking

Weekly Analysis: Energy Markets

Source: DTN ProphetX

Brent Crude Oil: The spot-month contract closed $3.03 lower at $56.42. The spot-month contract posted a new low of $55.48 last week, below major (long-term) support at $57.96. This price marks the 76.4% retracement level of the previous major uptrend from $36.20 through the high of $128.40. Pressure continues to come from a more bearish supply and demand situation, as indicated by the strengthening contango (carry) in the market's forward curve.

Crude Oil: The spot-month contract closed $2.04 lower at $52.69. The secondary (intermediate-term) trend remains down as the spot-month contract posted a new low of $52.03 last week. This is a test of major (long-term) support at $51.91, a price that marks the 76.4% retracement level of the previous uptrend from $32.48 through the high of $114.83. Pressure continues to come from the commercial side of the market, as indicated by the downtrend (strengthening contango/carry) in the market's futures spreads.

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Distillates: The spot-month contract closed 11.22cts lower at $1.7957. The secondary (intermediate-term) trend remains down as the spot-month contract posted a new low of $1.7871. Next major (long-term) support is pegged at $1.6550, a price that marks the 76.4% retracement level of the previous major uptrend from $1.1252 through the high of $3.3700.

Gasoline: The spot-month contract closed 7.53cts lower at $1.4334. The secondary (intermediate-term) remains down with the spot-month contract posting a new low of $1.4101. This is a test of major (long-term) support at $1.4208, a price that marks the 76.4% retracement level of the previous major uptrend from $0.7850 through the high of $3.4789.

Natural Gas: The spot-month contract closed 0.4ct lower at $3.003. After posting a new low of $2.805 the spot-month contract rallied to close back above major (long-term) support at $2.985. This price marks the 76.4% retracement level of the previous major uptrend from $1.902 through the high of $6.493. Monthly stochastics are below the oversold level of 20%, possibly sparking renewed buying interest.

Propane (Conway cash price): Conway propane closed 4.50cts lower at $0.4100. The cash market posted a new low last week of $0.4000, extending the secondary (intermediate-term) downtrend. Weekly stochastics are in single digits indicating the market is sharply oversold.

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