Technically Speaking | Energy | May 13

Tech-Speak-NRG-2

Darin Newsom - DTN Senior Analyst,
May 13, 2018

Crude Oil: The spot-month contract closed $0.98 higher at $70.70. Despite weekly stochastics continuing to show a sharply overbought situation, the market extended its secondary (intermediate-term) uptrend last week to a high of $71.89. Next major (long-term) resistance on the monthly chart is at $72.36, a price that marks the 38.2% retracement level of the previous major downtrend.

Distillates: The spot-month contract closed 6.80cts higher at $2.2220. Similar to crude oil, weekly stochastics for distillates continue to show a sharply overbought situation. However, the market extended its secondary (intermediate-term) uptrend to $2.2346 last week. Next major (long-term) resistance on the market’s monthly chart is at $2.4069, a price that marks the 61.8% retracement level of the previous major downtrend from $3.37 through the low of $0.8487.

Gasoline: RBOB gasoline futures market closed 7.48cts higher at $2.1888. Similar to distillates, weekly stochastics for RBOB gasoline continues to indicate a sharply overbought situation. Despite that, the spot-month contract extended the market’s seasonal uptrend to a new high weekly close last week. However, note that the market is approaching its normal 5-year and 10-year seasonal peaks that tend to occur in late May. The spot-month contract is testing major (long-term) resistance on the market’s monthly chart at $2.1882, a price that marks the 50% retracement level of the previous downtrend from $3.4789 through the low of $0.8975.

RBOB gasoline seasonal index -the trend of the front-month futures contract as it relates to the 5-year seasonal index.

Ethanol: The spot-month contract closed 3.9cts lower at $1.459. The market remains in a secondary (intermediate-term) side4ways trend between support at $1.400 and resistance at $1.510.

Natural Gas: The spot-month contract closed 9.5cts higher at $2.806. The market remains in a slowly building secondary (intermediate-term) uptrend. Weekly stochastics established a bullish crossover below the oversold level of 20% the week of April 16 and a new 4-week high of $2.839 the week of April 23. However, this high is also a test of initial resistance at $2.869, a price that marks the 23.6% retracement level of the previous downtrend from $3.994 through the low of $2.522. The 38.2% retracement level is up at $3.084.

Propane (Conway cash price): Conway propane closed unchanged at $0.7150. Cash propane remains in a secondary (intermediate-term) 5-wave uptrend, with last week’s low of $0.6700 looking to be the end of Wave 4. This was a test of support between $0.6729 and $0.6561, the 23.6% and 38.2% retracement levels of waves 1 through 3. Weekly stochastics are bullish, above the oversold level of 20%, indicating Wave 5 could extend to the next upside target of $0.8868.

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