Technically Speaking

Monthly Analysis: Energy Markets

Source: DTN ProphetX

Brent Crude Oil: The spot-month contract closed at $47.04, up $4.58 on the monthly chart. The market remains in a major (long-term) 5-Wave uptrend. The secondary (intermediate-term) downtrend is a Wave 2 pullback with support between $44.28 and $39.98. These prices mark the 33% and 50% retracement levels of Wave 1 from the low of $27.10 (January 2016) through $52.86 (June 2016). The August low was $41.51, possibly the Wave 2 low.

Crude Oil: The spot-month contract closed at $44.70, up $3.10 on the monthly chart. The market remains in a major (long-term) 5-Wave uptrend. The secondary (intermediate-term) downtrend is a Wave 2 pullback with support between $41.88 and $38.86. These prices mark the 38.2% and 50% retracement levels of Wave 1 from the low of $26.05 (February 2016) through $51.67 (June 2016). The August low was $39.19, possibly the Wave 2 low.

Distillates: The spot-month contract closed at $1.4102, up 13.42cts on the monthly chart. The market remains in a major (long-term) 5-Wave uptrend. The secondary (intermediate-term) downtrend is a Wave 2 pullback with support between $1.3036 and $1.2168. These prices mark the 38.2% and 50% retracement levels of Wave 1 from the low of $0.8487 (January 2016) through $1.5848 (June 2016). The August low was $1.2466, possibly the Wave 2 low.

Gasoline: The spot-month contract closed at $1.4122, up 9.12cts on the monthly chart. Similar to the oil markets, RBOB gasoline remains in a major (long-term) 5-Wave uptrend. The secondary (intermediate-term) downtrend is a Wave 2 pullback with support between $1.2870 and $1.1535. These prices mark the 50% and 67% retracement levels of Wave 1 from the low of $0.8975 (February 2016) through $1.6664 (May 2016).

Ethanol: The spot-month contract closed at $1.415, down 1.2cts on the monthly chart. Though the market looks to be in a trading range, 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.

Natural Gas: The spot-month contract closed at $2.887, up 1.1cts on the monthly chart. While the major (long-term) trend remains up, the spot-month contract continues to struggle pushing through resistance at $2.979. This price marks the 33% retracement level of the previous downtrend from $5.72 (January 2014) through the low of $1.611 (March 2016). The 50% retracement level is up at $3.665. Monthly stochastics are nearing the overbought level of 80% meaning the market may have limited time to extend its uptrend.

Propane (Conway cash price): Conway propane closed at $0.3975, up 2.25cts on its monthly chart. The major (long-term) trend remains sideways with resistance at $0.5428 and support at 0.2525. Monthly stochastics are neutrals near the 50% level.

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