Technically Speaking

Monthly Analysis: Energy Markets

Brent Crude Oil: The spot-month contract closed at $52.99, down $4.34 on the monthly chart. While the major (long-term) trend remains down, the rally late in the month had stochastics nearing a bullish crossover well below the oversold level of 20%. This would indicate the market could start to stabilize, and possibly turn bullish by the end of February. The spot-month is below support at $57.96, the 76.4% retracement level of the previous major uptrend from $36.20 (December 2008) through the high of $128.40 (March 2012).

Crude Oil: The spot-month contract closed at $48.24, down $5.03 on the monthly chart. As with Brent crude, the major (long-term) trend remains down though the late month rally brought stochastics close to a bullish crossover below the oversold level of 20%. This would indicate that the market could begin to stabilize above its January low of $43.58. The spot-month contract is below support at $51.91, a price that marks the 76.4% retracement level of the previous major uptrend from $32.48 (December 2008) through the high of $114.83 (May 2011).

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Distillates: The spot-month contract closed at $1.6863, down 16.03cts on the monthly chart. A rally late in the month brought the spot-month contract back above support at $1.6550, a price that marks the 76.4% retracement level of the previous major (long-term) uptrend from $1.1252 (March 2009) through the high of $3.3700 (January 2014). Weekly stochastics are nearing a bullish crossover well below the oversold level of 20%, indicating the major trend may be turning sideways. If so, look for the spot-month contract to hold above the January low of $1.5890 as it builds toward a possible uptrend in the months ahead.

Gasoline: The spot-month contract closed at $1.4152, down 2.01cts on the monthly chart. While the major (long-term) trend remains down, technical indicators are showing the market could be stabilizing. The spot-month contract posted a late month rally to finish near technical price support at $1.4208, a price that marks the 76.4% retracement level of the previous major uptrend from $0.7850 (December 2008) through the high of $3.4789 (April 2011). Monthly stochastics remain bearish, but below the oversold level of 20%.

Ethanol: The spot-month contract closed at $1.367, down 26.0cts on the monthly chart. The major (long-term) trend remains down as the spot-month contract posted a new low of $1.292 during January. Monthly stochastics remain bearish, but are well below the oversold level of 20% setting up a potential bullish crossover in the coming months.

Natural Gas: The spot-month contract closed at $2.691, down 19.8cts on the monthly chart. The major (long-term) trend remains down as the spot-month contract posted a new low of $2.637 during January. Major support remains at the previous low of $1.902 (April 2012). Monthly stochastics are below the oversold level of 20% setting the stage for a potential bullish crossover in the coming months.

Propane (Conway cash price): Conway propane closed at $0.4887, up 3.87cts on its monthly chart. The major (long-term) trend appears to have turned sideways with cash propane holding above its December low of $0.4000 during January. With monthly stochastics deep in single digits the market is in position to establish a major uptrend, possibly in February.

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