CNBC's Bertha Coombs discusses the day's activity in the commodities markets, and looks ahead to where oil and gold are likely headed tomorrow.
Tuesday, September 7, 2010
Markets Close Lower, Bulls Maintain The Advantage For Wednesday Morning
Crude oil closed lower on Tuesday due to profit taking but remains above the 10 day moving average crossing at 73.66. The mid range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near term. Closes above the reaction high crossing at 75.58 are needed to confirm that a short term low has been posted. If October renews the decline off August's high, May's low crossing at 70.35 is the next downside target. First resistance is the 20 day moving average crossing at 74.85. Second resistance is the reaction high crossing at 75.58. First support is August's low crossing at 70.76. Second support is May's low crossing at 70.35.
Natural gas posted an inside day with a lower close on Tuesday but remains above the 10 day moving average crossing at 3.844. The mid range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI are turning bullish hinting that a short covering rebound is possible near term. Closes above the 20 day moving average crossing at 4.048 are needed to confirm that a short term low has been posted. If October renews this year's decline, weekly support crossing at 3.225 is the next downside target. First resistance is last Friday's high crossing at 3.946. Second resistance is the 20 day moving average crossing at 4.048. First support is August's low crossing at 3.697. Second support is weekly support crossing at 3.225.
Gold closed higher on Tuesday and above the 87% retracement level of the June-July decline crossing at 1253.30 as it extends the rally off July's low. Stochastics and the RSI are overbought, diverging but are neutral to bullish signaling that sideways to higher prices are possible near term. If August extends the rally off July's low, June's high crossing at 1267.10 is the next upside target. Closes below the 20 day moving average crossing at 1234.40 are needed to confirm that a short term top has been posted. First resistance is today's high crossing at 1260.30. Second resistance is June's high crossing at 1267.10. First support is the 10 day moving average crossing at 1245.60. Second support is the 20 day moving average crossing at 1234.40.
The U.S. Dollar gapped up and closed higher on Tuesday as it consolidated some of the decline off August's high. The high range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI remain neutral to bearish signaling that sideways to lower prices are possible near term. If December extends last week's decline, August's low crossing at 80.75 is the next downside target. If December renews the rally off August's low, the reaction high crossing at 84.94 is the next upside target. First resistance is today's high crossing at 83.29. Second resistance is August's high crossing at 83.96. First support is last Friday's low crossing at 82.23. Second support is August's low crossing at 80.75.
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Crude Oil Falls for Second Day as Dollar's Gain Dims Appeal of Commodities
“The euro’s broken down and the dollar’s gotten stronger,” said Tom Bentz, a broker with BNP Paribas Commodity Futures Inc. in New York. “That’s helping to put some pressure on oil.” Crude for October delivery lost 60 cents, or 0.8 percent, to $74 a barrel at the 2:30 p.m. close of floor trading on the New York Mercantile Exchange. Earlier, it touched $72.63 a barrel, the biggest single day decrease since Aug. 31. Prices have dropped 6.8 percent this year.
U.S. oil markets were closed yesterday for the Labor Day holiday. Yesterday’s electronic transactions will be booked with today’s trades for settlement purposes. The euro fell 1.3 percent against the dollar to $1.2707 from $1.2876 yesterday, curbing the appeal of commodities as an alternative investment. The euro has declined 1.5 percent since Sept. 3. The S&P 500 lost 0.8 percent to 1,096.24, snapping a four day rally. The Dow Jones Industrial Average fell 72.73 points, or 0.7 percent, to 10,375.20.
Read the entire article and Watch Credit Suisse's Edward Morse Interview.
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Daryl Guppy: Crude Oil Turns Bearish, $54 May Be Downside Target
From guest blogger Daryl Guppy....
As recently as three weeks ago we remained bullish on oil. This view has now changed with a confirmation of a longer term chart pattern. Nymex oil is now showing a bearish pattern. There are still additional moves required to fully confirm the pattern but the development of bearish pressure is increasing. The behavior of oil in 2009 to 2010 has been dominated by two features. The first is the residual power of the historical support and resistance levels. The most important of these are between $78 and $88. The three recent tests near resistance at $88 created a bullish outlook with a potential to breakout and move to the next resistance level near $98.
The second feature was the development first of an up sloping trend channel. The lower edge of this channel was broken in May and a new lower parallel up trend channel developed. This lower channel has recently also been broken. It is the pattern of these breaks that point the way to a head and shoulder pattern. The rapid fall from $80.00 and the failure of the rebound is initial confirmation of the head and shoulder trend reversal pattern. If fully completed, it would put a downside target for oil near $54.
The pattern is confirmed in two ways. First when the price fails to rally above $81, which is the height of the right shoulder. This failure confirms the development of the right shoulder of the pattern. The second confirmation is a move below $65.00. This is the current projection value of the neckline in the head and shoulder pattern. Move below this level is final confirmation of the head and shoulder pattern.
Another confirmation, albiet minor, is a sustained close below historical support near $68. This has been a string support area since December 2009 and a major feature in the 2010 oil market behaviour. The development of the right shoulder has moved the NYMEX oil market out of the slightly bullish sideways consolidation band and into bearish territory. Traders use more caution in the long side of this market and are more aggressive in talking the short side.
Daryl Guppy is a trader and author of Trend Trading, The 36 Strategies of the Chinese for Financial Traders Guppy Traders.Com
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As recently as three weeks ago we remained bullish on oil. This view has now changed with a confirmation of a longer term chart pattern. Nymex oil is now showing a bearish pattern. There are still additional moves required to fully confirm the pattern but the development of bearish pressure is increasing. The behavior of oil in 2009 to 2010 has been dominated by two features. The first is the residual power of the historical support and resistance levels. The most important of these are between $78 and $88. The three recent tests near resistance at $88 created a bullish outlook with a potential to breakout and move to the next resistance level near $98.
The pattern is confirmed in two ways. First when the price fails to rally above $81, which is the height of the right shoulder. This failure confirms the development of the right shoulder of the pattern. The second confirmation is a move below $65.00. This is the current projection value of the neckline in the head and shoulder pattern. Move below this level is final confirmation of the head and shoulder pattern.
Another confirmation, albiet minor, is a sustained close below historical support near $68. This has been a string support area since December 2009 and a major feature in the 2010 oil market behaviour. The development of the right shoulder has moved the NYMEX oil market out of the slightly bullish sideways consolidation band and into bearish territory. Traders use more caution in the long side of this market and are more aggressive in talking the short side.
Daryl Guppy is a trader and author of Trend Trading, The 36 Strategies of the Chinese for Financial Traders Guppy Traders.Com
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Phil Flynn: Demand Jam
Still not even that may save the demand side of the equation. With storms battering up and down the East Coast, demand for gasoline was most likely impacted negatively. We are in the heart of the shoulder season and demand will continue to be very weak. We still maintain a bearish bias but still recommend playing the ranges.
The storms in the Atlantic never seem to end. There are 3 tropical waves that currently have about a 30% chance of becoming a tropical cyclone. At this time the storms do not seem to be a threat still they will bear watching.
What the bears really need to do is watch the me on the Fox Business Network and the bulls should join in too. If you don’t get it you need too!
Sign up for Phil's daily energy report and his daily buy and sell points on all of the major commodities by emailing him at pflynn@pfgbest.com.
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Crude Oil Technical Outlook For Tuesday Morning
Closes above the reaction high crossing at 75.58 are needed to confirm that a short term low has been posted. If October renews the decline off August's high, May's low crossing at 70.35 is the next downside target.
First resistance is the 20 day moving average crossing at 74.80.
Second resistance is the reaction high crossing at 75.58.
Crude oil pivot point for Tuesday morning is 74.12
First support is the reaction low crossing at 70.76.
Second support is May's low crossing at 70.35.
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Monday, September 6, 2010
Where is Crude Oil ETF USO Headed on Tuesday?
Based on a pre-defined weighted trend formula for chart analysis, USO scored -75 on a scale from -100 (strong downtrend) to +100 (strong uptrend):
+10......Last Hour Close Above 5 Hour Moving Average
+15......New 3 Day High on Friday
-20......Last Price Below 20 Day Moving Average
-25......New 3 Week Low, Week Ending August 28th
-30......New 3 Month Low in May
-75......Total Score
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Stefan van Woenzel: "The Oil Trader's Word(s)"
"The Oil Trader's Word(s)" is a book with a collection of close 1,000 words which are used by Oil Traders. Oil traders buy and sell oil, take positions and must have a lot of knowledge about Oil Logistics, Oil Paper, The Market, H.S.E. , Oil Documentation and much more. Oil Traders communicate a lot with operators, contract personal, claims departments, controllers, storage people, shipping agents, oil brokers, reporters and many more. The business language is not always easy to understand and often people do not ask what all the talk mean.
When I started in the oil business many years ago, I had no clue what traders talked about. I started in operations in a storage company. I learned the busines because I always asked questions. Even though when you ask a question to a trader you might still be puzzled after getting the answer. Very often I have been looking for an Oil trading Glossary. I could not find it, because it just did not exist. Therefore I decided to make a file to collect words in the Oil Busines which are most often used by trader or should be part of a trader's competence.
The result of collecting the Oil Trading Terms is what you find in my book, "The Oil Trader's Word(s)". I am Senior Crude Oil Trader and to be a trader, you have to be a man of your word. No room for flakers.
The back side of my book contains the following text:
Physical oiltrading is a worldwide activity containing a lot of oil business terms related to the physical trade, logistics, paper trading, refined products and H.S.E. This glossary of oiltrading terms is useful for people working in oil trading organisation (front, mid and back office), oilbrokers, oil inspection companies and storage companies, so basically to all people related to the oil industry.
The book is a guide to help understanding The Oil Trader’s Word(s). Pay also attention to the "Phrases of Wisdom" and H.S.E. stories in this book. This book is not meant to be used as legal documentation related to commercial or operational decisions.
Click here to find an internet shop to order the Oil Trading Glossary
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When I started in the oil business many years ago, I had no clue what traders talked about. I started in operations in a storage company. I learned the busines because I always asked questions. Even though when you ask a question to a trader you might still be puzzled after getting the answer. Very often I have been looking for an Oil trading Glossary. I could not find it, because it just did not exist. Therefore I decided to make a file to collect words in the Oil Busines which are most often used by trader or should be part of a trader's competence.
The result of collecting the Oil Trading Terms is what you find in my book, "The Oil Trader's Word(s)". I am Senior Crude Oil Trader and to be a trader, you have to be a man of your word. No room for flakers.
The back side of my book contains the following text:
Physical oiltrading is a worldwide activity containing a lot of oil business terms related to the physical trade, logistics, paper trading, refined products and H.S.E. This glossary of oiltrading terms is useful for people working in oil trading organisation (front, mid and back office), oilbrokers, oil inspection companies and storage companies, so basically to all people related to the oil industry.
The book is a guide to help understanding The Oil Trader’s Word(s). Pay also attention to the "Phrases of Wisdom" and H.S.E. stories in this book. This book is not meant to be used as legal documentation related to commercial or operational decisions.
Click here to find an internet shop to order the Oil Trading Glossary
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Crude Oil Hovers Above $74 as Traders Eye US Economy
Crude oil prices slipped to near $74 a barrel Monday in Asia as traders weighed whether growing Chinese demand can offset weak U.S. fuel consumption amid high unemployment. Benchmark oil for October delivery was down 25 cents at $74.35 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract fell 42 cents to settle at $74.60 on Friday.
Most investors took heart after the Labor Department on Friday said private employers added 67,000 jobs in August, more than analysts expected. However, the jobless rate rose in August to 9.6 percent from 9.5 percent in July, showing that unemployment remains high despite massive stimulus spending during the last year. Oil prices have been in a holding pattern around $75 for most of the past year as developed countries rebound from last year's recession but economic growth threatens to slow in the second half.
Traders are looking to China and other emerging economies to fuel demand for commodities in coming years. If China continues to grow at its current rate of about 9 percent a year until about 2030, its oil demand would equal all of today's global crude production, HSBC chief economist Stephen King said. "So the likelihood is over the next five to ten years, we'll see significantly higher oil prices," King said. "The China story is becoming more and more important."
In other Nymex trading in October contracts, heating oil fell 0.43 cent to $2.05 a gallon and gasoline dropped 0.33 cent to $1.916 a gallon. Natural gas for October delivery skidded 3.9 cents to $3.90 per 1,000 cubic feet.
In London, Brent crude was down 6 cents at $76.61 on the ICE Futures exchange.
From The Associated Press - Singapore
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Most investors took heart after the Labor Department on Friday said private employers added 67,000 jobs in August, more than analysts expected. However, the jobless rate rose in August to 9.6 percent from 9.5 percent in July, showing that unemployment remains high despite massive stimulus spending during the last year. Oil prices have been in a holding pattern around $75 for most of the past year as developed countries rebound from last year's recession but economic growth threatens to slow in the second half.
Traders are looking to China and other emerging economies to fuel demand for commodities in coming years. If China continues to grow at its current rate of about 9 percent a year until about 2030, its oil demand would equal all of today's global crude production, HSBC chief economist Stephen King said. "So the likelihood is over the next five to ten years, we'll see significantly higher oil prices," King said. "The China story is becoming more and more important."
In other Nymex trading in October contracts, heating oil fell 0.43 cent to $2.05 a gallon and gasoline dropped 0.33 cent to $1.916 a gallon. Natural gas for October delivery skidded 3.9 cents to $3.90 per 1,000 cubic feet.
In London, Brent crude was down 6 cents at $76.61 on the ICE Futures exchange.
From The Associated Press - Singapore
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Crude Oil Falls for Second Day on Speculation Fuel Demand Will Drop
Crude oil fell for a second day in New York on speculation that fuel demand will decline as the U.S. summer peak consumption season ends and as crude and fuel inventories rose. Today’s U.S. Labor Day holiday marks the end of the peak driving season. Traders are betting more on falling gasoline prices rather than rising for the first time in almost four years.
U.S. crude inventories are about 5 percent higher than a year ago, while gasoline stockpiles are almost 10 percent more than last year. “Factors like driving season demand and the level of oil inventories have been neglected in recent months,” Roland Stenzel, a crude trader at E&T Energie Handelsgesellschaft mbH, said from Vienna. “I am beginning to think this could become more important again.”
Crude for October delivery fell as much as 58 cents, or 0.8 percent, to $74.02 a barrel in electronic trading on the New York Mercantile Exchange. It was at $74.37 at 3:14 p.m. London time. There will be no floor trading on the Nymex today because of the U.S. holiday. All electronic trades will count as part of tomorrow’s session. Brent crude for October settlement advanced 36 cents, or 0.5 percent, to $77.03 a barrel as of 3:14 p.m. on the ICE Futures Europe Exchange in London.....Read the entire article.
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U.S. crude inventories are about 5 percent higher than a year ago, while gasoline stockpiles are almost 10 percent more than last year. “Factors like driving season demand and the level of oil inventories have been neglected in recent months,” Roland Stenzel, a crude trader at E&T Energie Handelsgesellschaft mbH, said from Vienna. “I am beginning to think this could become more important again.”
Crude for October delivery fell as much as 58 cents, or 0.8 percent, to $74.02 a barrel in electronic trading on the New York Mercantile Exchange. It was at $74.37 at 3:14 p.m. London time. There will be no floor trading on the Nymex today because of the U.S. holiday. All electronic trades will count as part of tomorrow’s session. Brent crude for October settlement advanced 36 cents, or 0.5 percent, to $77.03 a barrel as of 3:14 p.m. on the ICE Futures Europe Exchange in London.....Read the entire article.
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Sunday, September 5, 2010
Crude Oil Weekly Technical Outlook For Saturday September 4th
Crude oil was bounded in choppy sideway trading between 70.76/75.58 last week. Consolidations from 70.76 could still extend further and stronger recovery cannot be ruled out. But still, upside is expected to be limited by 61.8% retracement of 82.97 to 70.76 at 78.31 and bring resumption of fall fro 82.97. Sustained trading below 70.76/71.09 support zone will confirm our bearish view that whole rebound from 64.23 is finished at 82.97 already and target another low below 64.23.
In the bigger picture, choppy rebound from 64.23 is treated as a correction to fall from 87.15 only and has possibly finished at 82.97 already. Decisive break of 71.09 will confirm this bearish case and also indicate that whole fall from 87.15 is resuming for 60 psychological level, (50% retracement of 33.2 to 87.15 at 60.18, 100% projection of 87.15 to 64.23 from 82.97 at 60.05). Decisive break there will indicate that fall from 87.15 is developing into a powerful impulsive wave and would target 33.2 low. On the upside, break of 82.97 resistance is needed to invalidate this view. Otherwise, we'll stay bearish in crude oil.
In the long term picture, current development suggests that rebound from 33.2 is finished at 87.15, inside 76.77/90.24 fibo resistance zone as expected. Our view is that fall from 87.15 would develop into the third falling leg of the whole correction from 147.27 and hence, we'd anticipate an eventual break of 33.2 low in the long term as such correction extends.
Nymex Crude Oil Continuous Contract 4 Hour, daily, weekly and monthly charts
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Saturday, September 4, 2010
Where is Crude Oil and Gold Headed Next Week?
CNBC's Brian Shactman discusses the day's activity in the commodities markets and looks ahead to where oil and gas are likely headed next week.
Friday, September 3, 2010
Crude Oil Trader Market Summary For Friday Evening
Crude oil closed lower on Friday due to profit taking but remains above the 10 day moving average crossing at 73.56. The mid range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near term. Closes above the 20 day moving average crossing at 75.24 are needed to confirm that a short term low has been posted. If October renews the decline off August's high, May's low crossing at 70.35 is the next downside target. First resistance is the 20 day moving average crossing at 75.24. Second resistance is last Friday's high crossing at 75.21. First support is last Wednesday's low crossing at 70.76. Second support is May's low crossing at 70.35.
The U.S.Dollar closed lower on Friday as it extends yesterday's breakout below the 20 day moving average crossing at 82.61. The low range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near term. If September extends this week's decline, the reaction low crossing at 81.99 is the next downside target. If September renews August's rally, the reaction high crossing at 84.73 is the next upside target. First resistance is the 10 day moving average crossing at 82.94. Second resistance is last Tuesday's high crossing at 83.64. First support is today's low crossing at 82.05. Second support is the reaction low crossing at 81.99.
Natural gas closed higher on Friday and above the 10 day moving average crossing at 3.864 signaling that a short term low might be in or is near. The high range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are oversold and are turning neutral to bullish hinting that a short covering rebound is possible near term. Closes above the 20 day moving average crossing at 4.071 would confirm that a short term low has been posted. If October extends this year's decline, weekly support crossing at 3.225 is the next downside target. First resistance is today's high crossing at 3.946. Second resistance is the 20 day moving average crossing at 4.071. First support is last Friday's low crossing at 3.697. Second support is weekly support crossing at 3.225.
Gold closed lower due to profit taking on Friday as it consolidates below the 87% retracement level of the June-July decline crossing at 1253.30. Stochastics and the RSI are overbought, diverging but are neutral to bullish signaling that sideways to higher prices are possible near term. If August extends the rally off July's low, June's high crossing at 1267.10 is the next upside target. Closes below the 20 day moving average crossing at 1228.80 are needed to confirm that a short term top has been posted. First resistance is Wednesday's high crossing at 1255.30. Second resistance is June's high crossing at 1267.10. First support is the 10 day moving average crossing at 1240.60. Second support is the 20 day moving average crossing at 1228.80.
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Phil Flynn: Welcome To September!
An explosion and fire on a Mariner Energy platform had traders saying oh no here we go again. Mainer Energy, a former unit of Enron and now in the process of being bought by Apache, has had it shares of accidents racking up more than 12 in the last four years. Anytime you are dealing with oil and gas it is a potential dangerous situation and accidents are going to happen. The fears that this accident would give the critics of off shore drilling more ammunition to keep.....Read the entire article.
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5 Reasons Natural Gas Is Poised for Upside
This last week before Labor Day marked the 2009 low for natural gas prices. Both the natural gas price and natural gas stocks had a big run through to January 2010, creating great wealth for investors. Could that happen again this year? How real is the seasonal trade in natural gas? And how does the natural gas market compare this year over last?
This chart, published by www.rigzone.com (they have one of the best daily free e-letters in the industry) shows how well the big seasonal trade worked last year, and how it has fared for the last 10 years.
Looking at this year, 2010, we have on the positive side:
Storage is Trending Lower:
The EIA reported that for the week ended August 27, 2010 working gas in storage was 3,106 billion cubic feet (bcf), only 54 bcf larger than the prior week. U.S. storage is now 208 bcf less than last year at this time and 169 bcf above the 5-year average.
More importantly, storage injections have been below the 5-year average for 11 consecutive weeks and this trend is set to continue. Gas storage could end the refill season on November 1st at approximately 3,500 bcf. This level of storage heading into the winter heating season supports substantially higher natural gas prices.
2. Demand Continues to Strengthen:
According to the EIA demand for the first 6 months of 2010 was approximately 4.3% greater than the first 6 months of 2009.
Given the strong prices for coal this year, many utilities have stepped up their purchases of gas to run their usage of their natural gas fired power plant fleet.
Additionally, despite the weak economy in the U.S., industrial demand for natural gas has is higher this year compared to 2009.
Also, as we head into the winter heating season, demand for natural gas always picks up and should we have another cold winter storage could be drawn down very quickly.
3. Oil/Gas Ratio is Bullish:
While oil and gas on an energy equivalent basis should trade at a 6:1, the two commodities currently trade at approximately 19:1. Many natural gas focused exploration and production companies have turned their attention away from natural gas and towards oil. Chesapeake Energy (NYSE:CHK), the most active driller of shale gas wells in the U.S., has dramatically reduced its natural drilling in favor of a dozen new oil focused projects. Other companies have pursued similar paths.
4. Production Starting to Roll Over:
Monthly U.S. natural gas production which showed production fell 1.2% from May 2010 to June 2010, Due to falling production in the Gulf of Mexico, which accounts for nearly 11% of U.S. production, and several big producing states like Texas, Wyoming and New Mexico, overall U.S. production is headed downward for at least the next two years. Production growth from shale plays can no longer offset declines from the Gulf of Mexico and conventional areas.
5. Pressure Pumping Chokepoint: Due to increased demand for fracture stimulation services from the nearly dozen unconventional oil and gas plays currently under development in the U.S. and Canada, many operators are now having to wait weeks and even months for fracturing services. Once gas prices pick up and operators step up the pace of natural gas directed drilling, limited availability of fracture stimulation services will keep U.S. gas production from reversing its recently begun downtrend.
6. The forward curve for natural gas prices is much lower this year, which is to say the futures price for gas in 2011-2014 are lower than they were last year, this is bullish because it means producers can’t hedge big profits. It has also helped create the huge negative sentiment around natural gas prices, which we believe to be bullish.
On the negative side:
1. Producers are still being forced to drill to keep/earn land leases
2. Which is causing a continuing high rig count
3. And to pay for all this in the face of low cash flow, several large natural gas producers have formed joint ventures with big international companies, oftentimes National Oil Companies (NOC). This is BIG free money for these cash starved producers, and gives them the ability to keep drilling in the face of low prices.
4. Producers are now choking back production on prolific horizontal wells, reducing the steep (and highly publicized) decline rate of production in shale gas plays
5. Increased LNG capacity in both eastern Canada and the eastern US (though Liquid Natural Gas has been a non-factor in the North American market this year, and supply has been soaked up by Japan, Taiwan and China).
6. ETF (UNG-NYSE) buying continues to support prices. If low prices are the cure for low prices, investor buying in natural gas ETFs doesn’t help.
One of the last points for investors to consider, and this is neither bullish nor bearish, is that large commodity producers should not be relied upon as great gurus of their own pricing. In the last decade, some of the largest uranium, copper and gold producers, were caught completely by surprise when their commodity price spiked upwards, and were saddled with highly unprofitable hedges for years, at great cost to their shareholders.
The market will tell us within 60 days or less if the large seasonal run in natural gas prices will happen this year. We will be watching very closely.
With the fundamentals for natural gas greatly improved over the last couple of months and investment sentiment towards the commodity and gas weighted equities very negative, contrarian investors may consider getting positioned for a sharp rebound in gas prices.
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Crude Oil Daily Technical Outlook For Friday Morning
Closes above the 20 day moving average crossing at 75.26 are needed to confirm that a short term low has been posted. If October renews the decline off August's high, May's low crossing at 70.35 is the next downside target.
First resistance is the 20 day moving average crossing at 75.26
Second resistance is Monday's high crossing at 75.58
Crude oil pivot point for Friday morning is 74.42
First support is last Wednesday's low crossing at 70.76
Second support is May's low crossing at 70.35
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Crude Oil Heads for Weekly Decline on Forecast for U.S. Jobless Increase
“Trading is volatile,” said Peter McGuire, managing director at CWA Global Markets Pty in Sydney. “People are still sitting on the sidelines waiting for the unemployment numbers.” The October contract fell as much as 48 cents, or 0.6 percent, to $74.54 a barrel in electronic trading on the New York Mercantile Exchange, and was at $74.69 at 2:53 p.m. Singapore time. Yesterday, it gained $1.11 to $75.02. Futures are 0.6 percent lower this week and down 5.9 percent this year.
“The market will turn to payroll numbers tonight with expectations of a headline fall of 105,000 and a rise in the unemployment rate to 9.6 percent,” Mark Pervan, head of commodity research at Australia & New Zealand Banking Group Ltd. in Melbourne, said in an emailed note today.....Read the entire article.
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Thursday, September 2, 2010
Today's Trends: Crude Imports Decline, But Critical to U.S.
U.S crude oil imports grew rapidly from mid-20th century until the late 1970s, but fell sharply from 1979 to 1985, according to the U.S. Energy Information Administration (EIA) Annual Energy Review 2009. The trend resumed upward from 1985 through 2004, then remained flat through 2007 before dropping in 2008 and 2009.
In 2009, crude oil imports were 9.1 million b/d; petroleum product imports were 2.7 million b/d; and exports were 2.0 million b/d mainly the form of distillate and residual fuel oils.
U.S. petroleum imports rose sharply in the 1970s, and reliance on petroleum from the Organization of Petroleum Exporting Countries (OPEC) grew. In 2009, 41 percent of U.S. petroleum imports came from OPEC countries, down from 70 percent in 1977. After 1992, more petroleum came into the U.S. from non-OPEC countries than from OPEC countries.
Saudi Arabia, Venezuela, and Nigeria were the three key suppliers among OPEC countries of petroleum to the U.S. market. The amount of petroleum each country has sold to the U.S. has widely fluctuated over the decades. In 2009, Iraq supplied .4 million b/d of petroleum to the U.S., EIA reported.
Canada and Mexico were the largest non-OPEC suppliers of petroleum to the U.S. In 2009, U.S. imports from Canada reached a new high of 2.5 million b/d. Imports from Mexico were insignificant until the mid-1970s, when they began to play a key role in U.S. supplies. Canadian and Mexican petroleum together accounted for 32 percent of all U.S. imports in 2009.
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In 2009, crude oil imports were 9.1 million b/d; petroleum product imports were 2.7 million b/d; and exports were 2.0 million b/d mainly the form of distillate and residual fuel oils.
U.S. petroleum imports rose sharply in the 1970s, and reliance on petroleum from the Organization of Petroleum Exporting Countries (OPEC) grew. In 2009, 41 percent of U.S. petroleum imports came from OPEC countries, down from 70 percent in 1977. After 1992, more petroleum came into the U.S. from non-OPEC countries than from OPEC countries.
Saudi Arabia, Venezuela, and Nigeria were the three key suppliers among OPEC countries of petroleum to the U.S. market. The amount of petroleum each country has sold to the U.S. has widely fluctuated over the decades. In 2009, Iraq supplied .4 million b/d of petroleum to the U.S., EIA reported.
Canada and Mexico were the largest non-OPEC suppliers of petroleum to the U.S. In 2009, U.S. imports from Canada reached a new high of 2.5 million b/d. Imports from Mexico were insignificant until the mid-1970s, when they began to play a key role in U.S. supplies. Canadian and Mexican petroleum together accounted for 32 percent of all U.S. imports in 2009.
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Brian Shactman: Where is Crude Oil and Gold Headed on Friday
CNBC's Brian Shactman discusses the day's activity in the commodities markets and looks at where oil and gold are likely headed tomorrow.
Crude Oil Trader Market Summary For Wednesday Evening
Crude oil closed higher on Thursday and the high range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near term. Closes above the 20 day moving average crossing at 75.58 are needed to confirm that a short term low has been posted. If October renews the decline off August's high, May's low crossing at 70.35 is the next downside target. First resistance is last Friday's high crossing at 75.21. Second resistance is the 20 day moving average crossing at 75.58. First support is last Wednesday's low crossing at 70.76. Second support is May's low crossing at 70.35.
Natural gas closed higher on Thursday as it extends the trading range of the past five days. The mid-range close sets the stage for a steady opening on Friday. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near term. If October extends this year's decline, weekly support crossing at 3.225 is the next downside target. Closes above the 20 day moving average crossing at 4.101 would confirm that a short term low has been posted. First resistance is the 10 day moving average crossing at 3.889. Second resistance is the 20 day moving average crossing at 4.101. First support is last Friday's low crossing at 3.697. Second support is weekly support crossing at 3.225.
Gold closed higher on Thursday and tested the 87% retracement level of the June-July decline crossing at 1253.30. Stochastics and the RSI are overbought, diverging but are neutral to bullish signaling that sideways to higher prices are possible near term. If August extends the rally off July's low, June's high crossing at 1267.10 is the next upside target. Closes below the 20 day moving average crossing at 1226.60 would confirm that a short term top has been posted. First resistance is Wednesday's high crossing at 1255.30. Second resistance is June's high crossing at 1267.10. First support is the 10 day moving average crossing at 1238.60. Second support is the 20 day moving average crossing at 1226.60.
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