DTN’s Technical Analysis | ENERGY | Jul 20
July 20, 2018
Brent Crude Oil: The Brent contract is back in recovery mode in the overnight trading period after declining on Thursday. In the early US trading session Sep Brent is higher by $0.24 to $72.82 bbl. The contract is technically in a short term down trend but is currently back to trading within the confines of the downward trending linear regression trading channel since yesterday. The support level is now at 72.40 with resistance at $74.45. In overnight trading first/second contract spread is widening by $0.06 versus yesterday and is now in a $0.03 bbl contango. The front end contango structure is still bearish indicator for the market. The MACD indicator is pointing lower with the relative strength index moving back to a neutral level after yesterday’s light round of short covering.
Crude Oil: The soon to be spot September West Texas Intermediate contract is slightly higher in the overnight trading session after a light round of short covering in Thursday’s session. In the early US trading session, the contract is higher by $0.12 to $68.35 and trading inside the linear regression trading channel support level for the second day in a row. The WTI backwardation is widening this morning by $0.09 bbl or a slight positive for the contract. The MACD indicator is negative with the relative strength index starting to move toward an oversold level although it is not yet there.
Distillates: The ULSD contract is trading inside the linear regression trading channel support after moving back into the trading channel yesterday. So far in early US trading the contract is hovering around creating some distance above the channel support level of $2.08 with the resistance level currently at $2.1140. In the overnight trading session, the contract is trading higher by $0.0080 at $2.0981. The forward curve is in a seasonal contango through January delivery. The MACD indicator is bearish with the relative strength index moving toward an oversold condition.
RBOB Gasoline: The RBOB contract is also moving higher in the overnight session with RBOB increasing more than the ULSD contract so far this morning. The contract is trading inside the linear regression trading channel and above support after moving back into the trading channel on Wednesday. In the overnight trading session, the contract is trading higher by $0.0143 at $2.0571. The current channel support level is at $2.0300 with resistance at $2.0760. The gasoline market is in a seasonal backwardation, a price supportive market structure. The MACD indicator is bearish with the relative strength index moving toward an oversold condition.
Natural Gas: The Natural Gas market remains in a downtrend and trading within the confines of the downward sloping linear regression trading channel. Yesterday the contract was hit with a modest round of short covering buying on the back of a support weekly inventory report. In the early US trading the contract is unchanged at $2.769. The support level for this contract is at $2.76 with the next resistance level at $2.84. The August contract holds a premium to September delivery, but switches back to contango for the September/October combo. The MACD indicator is bearish with the relative strength index starting to slowly approach oversold territory.
*For technical analysis of monthly (long-term) and weekly (intermediate-term) trends see DTN’s Technically Speaking blog on your ProphetX system.
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