Technically Speaking | Energy | May 20

Tech-Speak-NRG-2

Darin Newsom - DTN Senior Analyst,
May 20, 2018

Crude Oil: The spot-month contract closed $0.58 higher at $71.28. Despite weekly stochastics continuing to show a sharply overbought situation, the market extended its secondary (intermediate-term) uptrend last week to a high of $72.30. This was a test of next major (long-term) resistance on the monthly chart at $72.36, a price that marks the 38.2% retracement level of the previous major downtrend. Monthly stochastics are above 90% indicating a sharply overbought long-term market.

Distillates: The spot-month contract closed 4.35cts higher at $2.2655. Similar to crude oil, monthly and weekly stochastics for distillates continue to show a sharply overbought situation. However, the market extended its uptrends (minor, secondary, and major) to $2.3069 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. Fundamental support continues to come from the market’s inverted forward curve.

Gasoline: RBOB gasoline futures market closed 4.45cts higher at $2.2333. The spot-month contract extended the market’s uptrends (minor, secondary, and major) to a new high of $2.2773 last week. This is well above 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. Fundamental support continues to come from the market’s inverted forward curve.

Ethanol: The spot-month contract closed 0.5ct higher at $1.464. 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 4.1cts higher at $2.847. 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 followed by a series of new 4-week highs, including last week’s $2.87. 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 6.38cts higher at $0.7788. Cash propane remains in a secondary (intermediate-term) 5-wave uptrend, with last week’s rally looking to be the beginning of Wave 5. This wave is expected to move above the Wave 3 peak of $0.8275, also a test of secondary resistance at $0.8291, and possibly extend to the next technical target of $0.8868. This price marks the 76.4% retracement level of the previous downtrend from $0.9800 through the low of $0.5850.

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