Technically Speaking

Weekly Analysis: Energy Markets

Source: DTN ProphetX

Brent Crude Oil: The spot-month contract closed $3.09 lower at $46.83. The secondary (intermediate-term) trend remains down. Weekly stochastics are bearish, just below 60%, meaning the market has room to fall back to test support between $44.28 and $39.98. These prices mark the 33% and 50% retracement levels of the previous uptrend from $27.10 through the high of $52.86. The recent low was $41.51 (week of August 1).

Crude Oil: The spot-month contract closed $3.20 lower at $49.33. The secondary (intermediate-term) trend remains down. Weekly stochastics are bearish, near 50%, meaning the market has room to fall back to test support between $41.88 and $38.86. These prices mark the 38.2% and 50% retracement levels of the previous uptrend from $26.05 through the high of $51.67. The recent low was $39.19 (week of August 1).

Distillates: The spot-month contract closed 8.76cts lower at $1.4096. The secondary (intermediate-term) trend remains down. Weekly stochastics are bearish, just below 60%, meaning the market has room to fall back to test support between $1.3036 and $1.2168. These prices mark the 38.2% and 50% retracement levels of the previous uptrend from $0.8487 through the high of $1.5848. The recent low was $1.2466 (week of August 1).

Gasoline: The spot-month contract closed 21.1cts lower at $1.3016. Much of the market's sharp sell-off this past week had to do with the expiration of the September contract and roll to the October as spot-month with a large backwardation in the spread. Nevertheless, the secondary (intermediate-term) trend remains down with initial support at $1.2820. This price marks the 50% retracement level of the previous uptrend from $0.8975 (week of February 8) through the high of $1.6664 (week of May 23). The 67% retracement level is down at $1.1535.

Ethanol: The spot-month contract closed 5.8cts higher at $1.500. The market looks to have confirmed its recent move to a secondary (intermediate-term) uptrend, posting a bullish outside week that included a new 4-week high of $1.500. The spot-month contract is already testing the 38.2% retracement level ($1.505) of the previous downtrend from $1.739 through the low of $1.360 (week of August 1). Note this low was below support at the $1.401, but closed that week at $1.413. Next resistance is at the 50% retracement level of $1.550.

Natural Gas: The spot-month contract closed 7.9cts lower at $2.792. The secondary (intermediate-term) trend is down after weekly stochastics established a bearish crossover above the overbought level of 80% the week of July 11. Initial support remains at $2.535, a price that marks the 33% retracement level of the previous uptrend from $1.811 through the high of $2.998. The 50% retracement level is down at $2.305.

Propane (Conway cash price): Conway propane closed 1.25cts lower at $0.3975. Despite the lower weekly close the secondary (intermediate-term) trend remains up. After testing resistance at $0.4188 the market moved into a minor (short-term) downtrend with support between $0.3933 and $0.3654, prices that mark the 33% and 67% retracement levels of the previous minor uptrend from $0.3375 through the high of $0.4212.

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