Oil, Natural Gas Lower Heading Into Tuesday's Trading

Crude oil was lower due to profit taking overnight as it consolidates some of the rally off July's low. Stochastics and the RSI are diverging but are bullish signaling that sideways to higher prices are possible near term.

If September extends the rally, the reaction high crossing at 74.25 is the next upside target. Closes below the 20 day moving average crossing at 65.18 would confirm that a short term top has been posted.

Tuesday's daily pivot point, our line in the sand is 70.88. Our weekly pivot point is 67.31.

First resistance is Monday's high crossing at 72.20
Second resistance is the reaction high crossing at 74.25

First support is the 10 day moving average crossing at 67.81
Second support is the 20 day moving average crossing at 65.18

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Natural gas was lower due to profit taking overnight as it consolidates some of Monday's rally. Stochastics and the RSI have turned bullish signaling that sideways to higher prices are possible near term. Closes above the reaction high crossing at 4.045 are needed to confirm that a low has been posted while opening the door for a larger degree rebound during the first half of August.

If September renews last week's decline, July's low crossing at 3.366 is the next downside target.

The natural gas pivot point for Tuesday is 3.92 with the weekly pivot point at 3.68.

First resistance is Monday's high crossing at 4.16
Second resistance is the reaction high crossing at 4.72

First support is the 10 day moving average crossing at 3.79
Second support is last Wednesday's low crossing at 3.46