Technically Speaking

Weekly Analysis: Energy Markets

Source: DTN ProphetX

Brent Crude Oil: The spot-month contract closed $2.25 higher at $69.87. Though weekly stochastics continue to show the market is overbought, the major (long-term) trend remains up. With monthly stochastics also above 80% the market could soon run out of bullish momentum long-term, and if so the secondary (intermediate-term) trend could turn down again. For now the market continues to be driven by a bullish forward curve.

Crude Oil: The spot-month contract closed $2.86 higher at $64.30. The spot-month contract continues to extend the market's secondary (intermediate-term) uptrend despite weekly stochastics above 90% indicating a sharply overbought situation. The major (long-term) uptrend continues to drive the secondary trend higher, with next major resistance pegged at $70.44.

Distillates: The spot-month contract closed 2.63cts higher at $2.0850. The market continues to be driven higher by its major (long-term) uptrend. However, the spot-month contract is testing major (long-term) resistance at $2.1094 with monthly stochastics well above 90% indicating a sharply overbought situation.

Gasoline: RBOB gasoline futures market closed 6.37cts higher at $1.8495. The secondary (intermediate-term) trend remains sideways-to-up. Weekly stochastics are near the overbought level of 80%.

Ethanol: The spot-month contract closed 4.2cts higher at $1.357. The nearby contract posted a bullish outside range last week as it extended the market's secondary (intermediate-term) uptrend. Resistance remains at $1.371, a price that marks the 23.6% retracement level of the previous downtrend from $1.760 through the low of $1.251. Weekly stochastics are bullish, climbing above the oversold level of 20%.

Natural Gas: The spot-month contract closed 40.5cts higher at $3.200. The market's secondary (intermediate-term) trend remains sideways with next resistance at $3.258. A move beyond this price would turn the secondary trend up.

Propane (Conway cash price): Conway propane closed 4.50cts lower at $0.8800. Cash propane remains in a secondary (intermediate-term) downtrend, with the ongoing move now Wave C (third wave) of an expected 3-wave move. Given that the market would be expected to move below the Wave A low of $0.8200, with support below that at $0.8071 and $0.7537.

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