Crude Oil Bulls Maintain a Near Term Advantage, Here's Friday's Numbers

Crude oil was higher overnight as it consolidates some of Thursday's decline. Stochastics and the RSI are overbought, diverging but are bullish signaling that sideways to higher prices are possible near term.

If May resumes the rally off February's low, the 75% retracement level of the January-February decline crossing at 81.63 is the next upside target. Closes below the 20 day moving average crossing at 78.17 would confirm that a short term top has been posted.

Friday's pivot point, our line in the sand is 80.33

First resistance is Wednesday's high crossing at 81.60
Second resistance is the 75% retracement level of the January-February decline crossing at 81.63

First support is the 10 day moving average crossing at 80.10
Second support is the 20 day moving average crossing at 78.17

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Natural gas was steady to lower overnight and posted a new contract low. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near term.

If May extends the decline off January's high, weekly support crossing at 4.157 is the next downside target. Closes above the 20 day moving average crossing at 5.090 would confirm that a short term low has been posted.

Natural gas pivot point for Friday is 4.639

First resistance is the 10 day moving average crossing at 4.811
Second resistance is the 20 day moving average crossing at 5.090

First support is the overnight low crossing at 4.612
Second support is weekly support crossing at 4.157

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The U.S. Dollar was slightly lower overnight as it consolidates some of Thursday's rally. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near term.

Closes below the reaction low crossing at 79.61 would open the door for a larger degree decline during March. If March renews this winter's rally, the 62% retracement level of the 2009 decline crossing at 82.92 is the next upside target.

First resistance is the reaction high crossing at 81.43
Second resistance is the 62% retracement level of the 2009 decline crossing at 82.92

First support is Wednesday's low crossing at 79.84
Second support is the reaction low crossing at 79.61


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Technical Analysis Video: The Line Is Drawn In the Sand In the Equity Markets?

To many technicians, it is very clear where the equity markets will reverse, and for those folks who don't follow the technicals, this is a key reversal area in the S&P 500, the NASDAQ, and the Dow.

In our new short video we show you the exact levels that we think will reverse this market, if in fact it's ever going to reverse to the downside.

Currently the major trend remains positive for all the indices and we would only become negative on the these markets should the key levels we show you today, are broken.

As always our videos are free to watch and there are no registration requirements. We would really like to hear your thoughts on this video and the markets, so please feel free to leave a comment.


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Crude Oil Falls From 7 Week High as Dollar's Gain Reduces Appeal of Commodities

Crude oil fell as the dollar climbed the most against the euro in two weeks, reducing the appeal of commodities as an alternative investment. Oil slipped as much as 1.4 percent on the greenback’s advance after European Central Bank President Jean-Claude Trichet kept its benchmark interest rate unchanged and extended some stimulus measures to cement the economic recovery. Prices also dropped as a report showed that the number of contracts to buy previously owned homes in the U.S. declined in January.

“The dollar has been gaining strength, which is having an impact on the energy markets,” said Tom Bentz, a broker at BNP Paribas Commodity Futures Inc. in New York. “We had some bad home sales data, which seems to also be sending prices lower.” Crude oil for April delivery fell 74 cents, or 0.9 percent, to $80.13 a barrel at 10:30 a.m. on the New York Mercantile Exchange. The contract rose 1.5 percent to $80.87 yesterday, the highest settlement level since Jan. 11.

Brent crude oil for April delivery declined 83 cents, or 1.1 percent, to $78.42 a barrel on the London-based ICE Futures Europe exchange. The dollar traded at $1.3595 per euro, up 0.8 percent from $1.3697 yesterday. The greenback is heading for the biggest gain since Feb. 17. An index of home purchase agreements, or pending home sales, fell 7.6 percent after a revised 0.8 percent increase in December, the National Association of Realtors announced today in Washington.....Read the entire article.


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Crude Oil Daily Technical Outlook For Thursday

Crude oil edges higher to 81.23 but upside momentum remains a bit unconvincing. Nevertheless, in any case, further rise is still in favor as long as 77.05 support holds. Current rise from 69.50 might continue for a retest on 83.95 high next. On the downside, though, break of 77.05 will argue that rebound from 69.50 is completed. In such case, focus will be shifted back to 69.50 support instead.

In the bigger picture, crude oil was supported above mentioned 68.59 key support and thus, there was no confirmation of medium term reversal. The strong rebound from 72.43 dampened our bearish view and argue that medium term rise from 33.2 might not be over yet. Nevertheless, as such rise from 33.2 is treated as a correction to whole decline from 147.27 only, even in case of another high above 83.95, we'd continue to expect strong resistance near to 50% retracement of 147.27 to 33.2 at 90.24 to bring reversal. On the downside, though, break of 69.50 support will now indicate that crude oil has topped out in medium term already and turn outlook bearish.....Nymex Crude Oil Continuous Contract 4 Hours Chart.


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Crude Oil Market Commentary For Wednesday Evening

Crude oil closed higher on Wednesday renewing the rally off February's low. The high range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are overbought, diverging and are turning neutral to bullish signaling that sideways to higher prices are possible near term.

If May extends the rally off February's low, the 75% retracement level of the January-February decline crossing at 81.63 is the next upside target. Closes below the 20 day moving average crossing at 77.53 would confirm that a short term top has been posted.

First resistance is today's high crossing at 81.60
Second resistance is the 87% retracement level of the January-February decline crossing at 83.53

First support is the 20 day moving average crossing at 77.53
Second support is last Thursday's low crossing at 77.44

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Natural gas closed higher due to short covering on Wednesday as it consolidates some of Monday's decline but remains below the 87% retracement level of the December-January rally crossing at 4.819. The high range close sets the stage for a steady to higher opening on Thursday.

Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near term. If May extends this winter's decline, December's low crossing at 4.656 is the next downside target. Closes above the 20 day moving average crossing at 5.171 are needed to confirm that a low has been posted.

First resistance is the 10 day moving average crossing at 4.917
Second resistance is the 20 day moving average crossing at 5.171

First support is Tuesday's low crossing at 4.725
Second support is December's low crossing at 4.656

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The U.S. Dollar closed lower on Wednesday and below the 20 day moving average crossing at 80.43. The low range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near term.

Closes below the reaction low crossing at 79.61 are needed to confirm that a short term top has been posted. If March renews this winter's rally, the 62% retracement level of the 2009 decline crossing at 82.92 is the next upside target.

First resistance is the reaction high crossing at 81.43
Second resistance is the 62% retracement level of the 2009 decline crossing at 82.92

First support is today's low crossing at 79.84
Second support is the reaction low crossing at 79.61


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Oil Rises to Seven Week High as Refinery Operating Rates Gain

Oil rose to a seven week high after a U.S. government report showed that refinery operating rates climbed to the highest level since October, bolstering demand. Refinery utilization increased 0.7 percentage point to 81.9 percent in the week ended Feb. 26, the Energy Department said. Analysts surveyed by Bloomberg News forecast that there would be no change. Inventories of crude oil climbed 4.03 million barrels, more than three times what was estimated.

“Refinery run rates increased strongly, which should whittle down the huge oversupply of crude oil,” said Sean Brodrick, a natural resource analyst with Weiss Research in Jupiter, Florida. “This market just wants to go higher, even when there is bearish news.” Crude oil for April delivery increased $1.31, or 1.6 percent, to $80.99 a barrel at 11:40 a.m. on the New York Mercantile Exchange. Futures reached $81.23, the highest level since Jan. 12. Oil traded at $80 a barrel before the release of the inventory report at 10:30 a.m. in Washington.

Total U.S. fuel demand, averaged over the past four weeks, was 19.3 million barrels, up 3 percent from a year earlier, the department said. “We’re seeing a little demand improvement, which gives impetus to higher prices,” said Chip Hodge, who oversees a $9 billion natural resource bond portfolio as senior managing director at MFC Global Investment Management in Boston. “There continues to be optimism that economic growth will accelerate, and with it demand.”

Nationwide stockpiles of crude oil rose 1.2 percent to 341.6 million, the highest level since August, the report showed. It was the biggest gain since the week ended July 24.....Read the entire article.


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Crude Oil Daily Technical Outlook Wednesday Morning

Crude oil had another attempt to resume rally but failed again and settled back into familiar range of 77.05 and 80. Intraday bias remains neutral and more sideway trading could stil be seen. But after all, outlook remains bullish as long as 77.05 support holds. Break of 80.95 will indicate rally resumption and should target 83.95 high next. However, note that below 77.05 support will argue that rebound from 69.50 is completed with a double top. In such case, focus will be shifted back to 69.50 support instead.

In the bigger picture, crude oil was supported above mentioned 68.59 key support and thus, there was no confirmation of medium term reversal. The strong rebound from 72.43 dampened our bearish view and argue that medium term rise from 33.2 might not be over yet. Nevertheless, as such rise from 33.2 is treated as a correction to whole decline from 147.27 only, even in case of another high above 83.95, we'd continue to expect strong resistance near to 50% retracement of 147.27 to 33.2 at 90.24 to bring reversal. On the downside, though, break of 69.50 support will now indicate that crude oil has topped out in medium term already and turn outlook bearish.....Nymex Crude Oil Continuous Contract 4 Hours Chart.


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Crude Oil Closes Higher, Bulls Still Have a Lot to Prove

Crude oil closed higher on Tuesday as it extends the trading range of the past two weeks. The mid range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI are overbought and are turning neutral to bearish hinting that a short term top is in or is near.

Closes below the 20 day moving average crossing at 77.38 would confirm that a short term top has been posted. If May resumes the rally off February's low, the 75% retracement level of the January-February decline crossing at 81.63 is the next upside target.

First resistance is today's high crossing at 81.32
Second resistance is the 75% retracement level of the January-February decline crossing at 81.63

First support is last Thursday's low crossing at 77.44
Second support is the 20 day moving average crossing at 77.38

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Natural gas closed higher due to short covering on Tuesday as it consolidates some of Monday's decline but remains below the 87% retracement level of the December-January rally crossing at 4.819. The high range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near term.

If May extends this winter's decline, December's low crossing at 4.656 is the next downside target. Closes above the 20 day moving average crossing at 5.203 are needed to confirm that a low has been posted.

First resistance is the 10 day moving average crossing at 4.978
Second resistance is the 20 day moving average crossing at 5.203

First support is Monday's low crossing at 4.740
Second support is December's low crossing at 4.656

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The U.S. Dollar closed lower on Tuesday while extending February's trading range below the 50% retracement level of the 2009-decline crossing at 81.32. The low range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI are bearish signaling that the March Dollar might continue to correct more in time than in price.

Closes below the reaction low crossing at 79.61 are needed to confirm that a short term top has been posted. If March renews this winter's rally, the 62% retracement level of the 2009 decline crossing at 82.92 is the next upside target.

First resistance is the reaction high crossing at 81.43
Second resistance is the 62% retracement level of the 2009 decline crossing at 82.92

First support is the 20 day moving average crossing at 80.41
Second support is last Tuesday's low crossing at 80.15

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Phil Flynn: Trying to Keep Positive

You've got to accentuate the positive, eliminate the negative and latch on to the affirmative, don't mess with Mister In Between. Oil tried to rally. It really did. It tried to ignore that pesky Mr. In Between, a place where it seems the market is most comfortable. Oil rallied even as the dollar soared and the British pound plunged. It tried to soar with the stock market and tried to worry about one Iranian oil official saying he would cut off oil supply to Europe. It tried to focus on the positive economic news and ignore the negative. Yet at some point the negative came in and the market realized that the day’s events just were not that bullish for oil.

Take Iranian deputy commander of Iran’s Revolutionary Guards who threatened to cut off Europe’s oil supply. He was probably cranky because he got his bank account frozen. Well that would be great because if they did cut off oil supply to Europe, that would be the equivalent of Iran putting economic sanctions on themselves. That would save a lot of time and effort thank you very much. In a world awash in spare production capacity and excess supply, would anyone really care for too long? The sell off in oil seems to suggest the oil market is saying, “Go ahead, make my day”.
The oil market tried to be positive about the consumer spending number which had a 0.5 percent increase in purchases and was better than expected but with the ISM manufacturing number falling to 56.5 in February and shy of expectations, did anyone actually increase their oil demand expectations?

Now add to that expectations by the surveys that we will see supply increase this week it was getting harder to keep that blindly bullish optimism going. Bloomberg News says that crude inventories probably increased for a fifth week as imports climbed. The Bloomberg News survey showed stockpiles rose 1.6 million barrels last week from 337.5 million, according to the median of eight estimates before an Energy Department report this week. Seven of the respondents forecast an increase and one estimated a decline. It would be the longest stretch of consecutive advances since May. Imports of crude oil increased 6.3 percent to 9.08 million barrels a day in the week ended Feb. 19, the highest level since October, according to last week’s report.

Now I think that crude supply could fall due to an increase in refinery runs. Last week we saw that refineries operated at 81.2 percent of capacity. That increase in runs could be the start of a bit of a trend and could give us a surprise draw in oil. As for the rest of the survey, Bloomberg says that it expects stockpiles of distillate fuel, a category that includes heating oil and diesel, probably fell 500,000 barrels from 152.7 million the prior week. As for gasoline, Bloomberg says that analysts were split over whether gasoline supplies increased or declined. Inventories probably rose 50,000 barrels from 231.2 million, the survey showed.
Oil and products continue to trade in well defined ranges.

There have been great daily opportunities. Trend traders are frustrated as the bulls or bears cannot score a decisive knock out. We still are predicting an eventually big break to the downside and the market’s inability to gain traction above $80 a barrel is making it harder for the bulls to make their case. Use this strength to put on bearish option plays or perhaps some iron condors. In the mean time call for specific trade entries for day trades and position trades at 800-935-6487 or email me at pflynn@pfgbest.com to open your account. And to get the best business news in the business make sure you are tuned into the Fox Business Network where you can see me every day.


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Crude Oil Rises to Seven Week High as Global Equity Markets Advance

Crude oil rose to a seven week high as equity markets advanced, increasing optimism that a growing global economy will bolster fuel demand. Oil climbed as much as 2.9 percent as the MSCI Emerging Markets Index climbed to its highest level in five weeks after India’s economy improved. The gain accelerated as the dollar weakened against the euro, raising demand for commodities as an alternative investment.

“We are seeing new fund money come into commodities,” said Carl Larry, president of Oil Outlooks & Opinions LLC in Houston. “Everyone is focused on growth and how best to profit from it. There are still a lot of jobless but the economy has begun to grow.” Crude oil for April delivery rose $1.93 or 2.5 percent, to $80.63 a barrel at 1:12 p.m. on the New York Mercantile Exchange. Futures touched $80.95, the highest level since Jan. 12. Prices have doubled from a year earlier.

Oil has traded between $69.50 and $83.95 a barrel this year. Futures have topped $80 every day since Feb. 19. “This is still a range-bound market,” said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut. “We are testing the top end of the range right now on some positive economic sentiment, but it’s questionable whether we can actually break through.”

“There’s no single news item behind today’s move,” said Tom Bentz, a broker at BNP Paribas Commodity Futures Inc. in New York. “We’ve been trading between $77 and the $85.50 area for the last week and have finally poked through on the upside. It is questionable if it can continue to advance from here”.........Read the entire article.


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