Technically Speaking

Monthly Analysis: Energy Markets

Source: DTN ProphetX

Brent Crude Oil: The spot-month contract closed at $52.24, up $0.03 on the monthly chart. The market is giving mixed signals at the end of August. The move to a new low of $42.23 combined with continued neutral-to-bearish monthly stochastics indicating the major (long-term) trend remains down. However the sharp rally at the end of the month, taking the market to a close back above support at $50.96, looks to have established a spike reversal. If so the spot-month contract should continue its rally in September, leading to a bullish crossover by monthly stochastics at the end of the month.

Crude Oil: The spot-month contract closed at $47.47, up $0.35 on the monthly chart. Last month's move to a new low of $37.75 creates a less than perfect picture of a conclusion to Wave 2 of a major (long-term) 5-wave uptrend. However, the spot-month contract was able to close back above support at $46.88 establishing what looks to be a spike reversal on the monthly chart. Monthly stochastics remain neutral-to-bearish below the oversold level of 20%, but nearing a bullish crossover. Pressure continues to come from commercial selling, as indicated by the strengthening contango, indicating a more bearish view of supply and demand.

Distillates: The spot-month contract closed at $1.6575, up 7.35cts on the monthly chart. Like the crude oil markets, distillates posted a spike reversal in August, rallying off its new low of $1.3745 to close back above its previous low of $1.5890. Monthly stochastics remain neutral-to-bearish below the oversold level of 20%.

Gasoline: The spot-month contract closed at $1.4601, down 38.09cts on the monthly chart. The market continues to indicate it is in Wave 2 of a major (long-term) 5-wave uptrend, holding above its previous low of $1.2265 to close back above support at $1.4529. The last signal in monthly stochastics was a bullish crossover at the end of February 2015.

Ethanol: The spot-month contract closed at $1.46, down 4.5cts on the monthly chart. The spot-month contract continues to hold above support at $1.431, a price that marks the 67% retracement level of the previous rally from $1.292 (January 2015) through the high of $1.709 (May 2015), indicating the major (long-term) trend remains up. Weekly stochastics remain bullish, below the oversold level of 20%.

Natural Gas: The spot-month contract closed at $2.685, down 3.1cts on the monthly chart. The major (long-term) trend is sideways with monthly stochastics neutral-to-bullish below the oversold level of 20%. Resistance is at the May 2015 high of $3.105 while support is the April 2015 low of $2.443.

Propane (Conway cash price): Conway propane closed at $0.3550, up 5.12cts on its monthly chart. The major (long-term) trend looks to have turned up, moving above the July high of $0.3450 and closing higher for the monthly. Monthly stochastics remain neutral-to-bullish below the oversold level of 20%.

To track my thoughts on the markets throughout the day, follow me on Twitter: www.twitter.com\DarinNewsom

Comments

To comment, please Log In or Join our Community .