Technically Speaking

Weekly Analysis: Energy Markets

Source: DTN ProphetX

Crude Oil: The spot-month contract closed $1.62 higher at $69.72. The market extended its secondary (intermediate-term) uptrend last week. Despite weekly stochastics above 80% indicating an overbought situation, the spot-month contract posted a bullish outside range. Next major (long-term) resistance on the monthly chart is at $72.36, a price that marks the 38.2% retracement level of the previous major downtrend.

Distillates: The spot-month contract closed 0.31ct higher at $2.1540. While the market remains in a secondary (intermediate-term) uptrend, las week's close indicates possible indecision by traders. Using a candlestick weekly chart, last week's price pattern is a doji, interpreted as an equilibrium between buyers and sellers since the week's open ($2.1510) and close were nearly equal. Given weekly stochastics are above 80%, indicating an overbought market, the doji could also be signaling a potential bearish reversal is in the making.

Gasoline: RBOB gasoline futures market closed 1.29cts lower at $2.1140. Similar to distillates, RBOB's weekly candlestick chart also shows a doji given its opening price of $2.1194 and slightly lower closing price. However, in this market weekly stochastics are above 90% indicating a sharply overbought situation, and in position for another bearish crossover. All this means the market is poised to move into a secondary (intermediate-term) downtrend, with resistance at last week's high of $2.1476.

Ethanol: The spot-month contract closed 0.5cts higher at $1.498. The market remains in a secondary (intermediate-term) side4ways trend between support at $1.400 and resistance at $1.510.

Natural Gas: The spot-month contract closed 6.0cts lower at $2.711. Despite its lower weekly close the market still looks to be in a slow building secondary (intermediate-term) uptrend. Weekly stochastics established a bullish crossover below the oversold level of 20% the week of April 16 and a new 4-week high of $2.839 the week of April 23. However, this high is also a test of initial resistance at $2.869, a price that marks the 23.6% retracement level of the previous downtrend from $3.994 through the low of $2.522. Support remains near the previous low.

Propane (Conway cash price): Conway propane closed 9.25cts lower at $0.7150. Despite last week's sell-off, cash propane remains in a secondary (intermediate-term) 5-wave uptrend. However, the previous week's high of $0.8275 now looks to be the peak of Wave 3, with a Wave 4 sell-off technically supposed to stay above the Wave 1 high of $0.6900.

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