The Daily Energy Technical Report 6.14.13

MrTopStep.com

European throughput to refineries is at its lowest point in several years, and this has helped the strength of diesel. In addition to the Rotterdam refinery issues, this supported gasoil and its American cousin 2oil. Brent oil was also stronger on supply concerns due to maintenance in the North Sea.

Arming the Syrian rebels is still an issue for the oil markets. The West has yet to agree on any plan.

Thursday’s most striking feature was the risk markets shrugging off the Asian meltdown. This surprised us since we expected margin calls for liquidation. However, it never developed. A market that ignores bearish news is bullish by definition. Jobless claims and retail sales also aided in the recovery process. It sparked a rally in equities, which spilled over into Crude.

In late news Thursday, Jon Hilsenrath of the WSJ said that Fed Chairman Bernanke would push back on the raising of interest rates. We suspect that the wild swings in Japan may have prompted him to issue that message. It may take some pressure off the large hedge funds. It is also the probable reason why the margin selling did not hit the market Thursday. The smart money already knew.

WTI
WTI S2 S1 CLOSE R1 R2 TREND
DAILY 9514 9620 9669 9823 9984 UP
WEEKLY 8714 9182 9603 9980 10300 UP

 Daily Moving Averages: 21, 55, & 100: 94.74, 93.81 , 94.09

Weekly Moving Averages: 21, 55, & 100: 94.08 , 91.29 , 93 .44

Although our first support level on Thursday was 95.00, we thought that margin selling would have breached that mark.

  • As it turned out the hedge funds that were caught in Japan seemed to weather the storm.
  • A late day announcement that the Fed would taper the talk about tapering spurred a sharp rally in the risk markets.
  • The bulls are in charge and they will want to move July above 97.20 to touch off stops.
  • We are a cautious buyer of the dip. There  will be support at 96.35 to 96.20. The minor pivot is 95.85.
  • We will buy the 96.25 level with a stop below 96.00.Usually when a market breaks the round number it will hold that level on the first pass.
  • As we have been saying for a few days now, there is the massive head & shoulders bottom that is looming above the market.
  • July may a charge for the stops late in the day, but failed to get above 97.00.
  • As long as July holds 96.20, a rise to 98.00 to 98.20 will be witnessed.
  • The key pivot is 95.00.

 

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CRUDE 061413

 

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CRUDE WKLY 061013

BRENT
BRENT S2 S1 CLOSE R1 R2 TREND
DAILY 10310 10423 10425/10495 10624 10721 UP
WEEKLY 9357 10013 10456 10855 11060 UP

Daily Moving Averages: 21, 55, & 100: 103.23 , 103.49 , 107.79

Weekly Moving Averages: 21, 55, & 100: 108.18 , 108 .11, 110.59

August was strong Thursday on the back of North Sea maintenance and Euro oil stocks being low.

  • This enabled August to rise above trend resistance at 104.65 and settle above that mark.
  • That suggests that Aug will experience another run to the upside for Friday.
  • The upside extension pivot is a five-minute settle above 105.15.
  • In this event Aug will search out the 100  DMA at 106.24.
  • However, there is likely to be minor resistance ahead of that level at 105.80.
  • But with the rekindled hope of no tapering in the intermediate term, the bulls will press their drive to higher levels.
  • We are a buyer of the dip.
  • Auggie will have initial support at 104.40 to 104.25. The minor pivot is 104.00. We will attempt our trade at 104.30.
  • The key downside pivot to the intraday chart is 103.10.

 

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brent 061413

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BRENT WKLY 061013

WTI-BRENT
WTI-BRENT S2 S1 CLOSE R1 R2 TREND
DAILY -940 -867 -803 -740 -669 CONGEST LOWER
WEEKLY -1355 -1000 -853 -698 -379 UP

Daily Moving Averages: 21, 55, & 100: -7.85 , -8.18 , -8.20

Weekly Moving Averages: 55, 100, & 200: -10.25 , -14.14 , –17.37

We forecast that July would congest lower for Thursday, which it did.

  • We have now switched to August for comment and pricing.
  • The chart below labels the move to Thursday’s high of -7.34 as an a-b-c correction.
  • This will probably mean that Aug will congest lower for Friday.
  • There is a downside  pivot at -8.20.
  • If this level is punctured on a fifteen-minute basis, Aug will fall to -8.60 to -8.70.
  • The extension pivot is -8.76.
  • August’s key downside pivot of -9.40 is not likely to be threatened.
  • Resistance is noted at -7.60 to -7.40.
  • We are a seller of the rally at -7.50 with a protective stop above -7.30.

 

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wti-brent 061413

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wti-brent wkly 060313

RBOB
RBOB S2 S1 CLOSE R1 R2 TREND
DAILY 28000 28415 28613 28815 29355 UP
WEEKLY 26880 27465 28715 29770 30415 UP

Daily Moving Averages: 21, 55, & 100: 2.8396, 2.8475 , 2.9383

Weekly Moving Averages: 21, 55, & 100: 2.9534 , 2.8748 , 2.8846

July staged a key reversal to the upside Thursday.

  • It appears that the bears will be eating crow for dinner of which we were one.
  • The operative word in that sentence is were.
  • July has proven itself for more upside to follow.
  • There will be support at 2.8450 to 2.84.
  • The minor downside pivot is 2.83.
  • The key downside pivot is 2.7980.
  • We are a buyer of the dip. This is at the 2.840 level. It is from this level that July broke the intraday resistance to run stops.
  • July will have initial resistance at 2.88 to 2.8850.
  • The pivot is 2.89.
  • Rising above that market will likely trip more stops. This will push July to the 2.93 to 2.9350 area where the 100 DMA resides.

 

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MOGAS 061413

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MOGAS WKLY 061013

ETHANOL
ETHANOL S2 S1 CLOSE R1 R2 TREND
DAILY 2430 2446 2461 2480 2526 UP
WEEKLY 2365 2430 2506 2650 2750 DOWN

Daily Moving Averages: 21, 55, & 100: 2.606, 2.543 , 2.500

Weekly Moving Averages: 21, 55, & 100: 2.500 , 2.414 , 2.424

While we were looking for July to congest higher Thursday, it was stronger than anticipated.

  • The model labeled below shows a completed five wave move down.
  • This will mean that July will correct the move from 2.60 to 2.407.
  • The first leg of the corrective process was seen Thursday.
  • It is likely that July retraces from the 2.47 level to see initial support at 2.45 to 2.445.
  • The minor pivot is 2.44. The key pivot is 2.407.
  • We are in a buy the dip mode.
  • July will have an upside pivot to this model at 2.48.
  • Busting that level on a fifteen minute basis will signal a continued rise to 2.525 to 2.53.

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ethanol 061413

 

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ETHANOL WKLY 061013

DISTILLATE
HEAT S2 S1 CLOSE R1 R2 TREND
DAILY 28740 29185 29395 29615 29875 UP
WEEKLY 27255 27665 28931 29995 30540 UP

Daily Moving Averages: 21, 55, & 100: 2.8809 , 2.8885 , 2.9614

Weekly Moving Averages: 21, 55, & 100: 2.9700 , 2.9699 , 3.0030

Very low refinery throughput in Europe combined with the Rotterdam refinery down has kept July on its seasonal trend for higher prices until the Fourth of July.

  • It appears that July has more upside to come Friday.
  • There is likely to be a marginal retrace for the early session Friday.
  • But we are in a buy the dip mode.
  • This will be tackling support at 2.92 to 2.9150 for the trade.
  • The downside pivot is 2.9040. Our stop will be placed below that level.
  • July’s upside target is the 100 DMA  at 2.9615.
  • While a daily settle above that price will be a strong indicator for next week, an intraday break of the moving average will tag 2.9850 to 2.99.
  • With the hope for continued bond buying from the Fed, the money will be betting on a stronger recovery and more demand for the fuel.

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heat 061413

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HEAT WKLY 061013


NATGAS
NATGAS S2 S1 CLOSE R1 R2 TREND
DAILY 3645 3780 3814 3870 3960 CONGEST
WEEKLY 3385 3645 3828 4030 4350 DOWN

Daily Moving Averages: 21, 55, & 100: 4.006 , 4.071 , 3.814

Weekly Moving Averages: 21, 55, & 100: 3.804 , 3.367, 3.264

We missed our count for Thursday thinking that there would be a new low to follow.

  • But the inventory came in better than expected.
  • Moreover, there was a promise from the new Energy Sect. that a decision on the exportation of natural gas would be made this year.
  • This too help support the market.
  • In actuality, we did have a completed move to the 3.71 area.
  • However, July is likely to congest for Friday.
  • She will have minor support at 3.795 to 3.78.
  • The pivot is 3.755 and the key pivot is 3.70.
  • Although we cannot rule out a new low, that is not likely to be Friday.
  • However, if the pivot at 3.70 is removed the support comes in at 3.655 to 3.63.

 

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nat 061413

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