Technically Speaking

Monthly Analysis: Energy Markets

Source: DTN ProphetX

Brent Crude Oil: The spot-month contract closed at $50.47, up $2.17 on the monthly chart. The market remains in a major (long-term) uptrend, though unable to push through its previous high of $53.73 (October 2016). However, if the market is able to break out of this consolidation pattern dating back to June 2016, the next upside target is $65.80. This price marks the 38.2% retracement level of the previous downtrend from $128.40 through the low of $27.10. Monthly stochastics remain bullish, but nearing the overbought level of 80%.

Crude Oil: The spot-month contract closed at $49.44, up $2.58 on the monthly chart. The market remains in a major (long-term) uptrend, though unable to push through its double-top high near $51.67. However, if the market is able to break out of this consolidation pattern dating back to June 2016, the next upside target is $59.96. This price marks the 38.2% retracement level of the previous downtrend from $114.83 through the low of $26.05. Monthly stochastics remain bullish, but nearing the overbought level of 80%.

Distillates: The spot-month contract closed at $1.5709, up 7.54cts on the monthly chart. The market remains in a major (long-term) uptrend with next resistance at $1.6883. This price marks the 33% retracement level of the previous downtrend from $3.3700 (January 2014) through the low of $0.8487 (January 2016). Monthly stochastics remain bullish, but nearing the overbought level of 80%.

Gasoline: The spot-month contract closed at $1.4908, up 4.13cts on the monthly chart. The major (long-term) trend is up, and could strengthen after the spot-month contract posted a bullish outside month during November. With monthly stochastics still well below the overbought level of 80% the market could extend its uptrend to the next target of $1.7571, a price that marks the 33% retracement level of the previous downtrend from $3.4789 through the low of $0.8975. Initial resistance is at the May 2016 high of $1.6664.

Ethanol: The spot-month contract closed at $1.650, up 1.5cts on the monthly chart. The major (long-term) trend remains up. Initial resistance is pegged at $1.712, a price that marks the 23.6% retracement level of the previous downtrend from $3.07 (July 2011) through the double-bottom low of $1.292 (January 2015 and January 2016). The June 2016 high was $1.739. Monthly stochastics are bullish and still below the overbought level of 80%.

Natural Gas: The spot-month contract closed at $3.352, up 32.6cts on the monthly chart. The major (long-term) uptrend still looks to be nearing its end with the spot-month contract between resistance at $3.181 and $3.665. These prices mark the 38.2% and 50% retracement levels of the previous downtrend from $4.352 (December 2013) through the low of $1.611 (March 2016). Monthly stochastics are well above the overbought level of 80% and poised for a bearish crossover.

Propane (Conway cash price): Conway propane closed at $0.5425, up 2.00cts on its monthly chart. The major (long-term) trend is up with resistance at $0.5428. This price marks the 23.6% retracement level of the previous downtrend from $1.4825 (December 2013) through the low of $0.2525 (January 2016). Monthly stochastics remain bullish but nearing the overbought level of 80%.

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