Stuck In The Middle

On April 30, 2012 by TradingDesk
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April trading appears set to go out on a quiet note, with most global markets making small moves in the red. The recent string of depressing European headlines continues, putting more downward pressure on prices.

The big news for energy this morning is that Energy Transfer Partners is buying Sunoco for $5.3 Billion. The most pressing issue for the futures market is what this will mean for Sun’s Philadelphia refinery. At this point the company is continuing with its plan to operate the plant as a JV with the Carlyle group.

We are now squarely in the middle of the historical peaking window for gasoline futures, and prices are fittingly stuck squarely in the middle of recent trading ranges, and technical studies are mixed. Look for choppy, sideways trading until something forces a new trend to form.

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Energy Futures Stuck In Limbo

On April 27, 2012 by TradingDesk
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Global markets were relatively quiet overnight, largely shrugging off another S&P downgrade of Spain, and news that Japan’s central bank was injecting another $100 billion plus to stimulate their struggling economy. US GDP just reported for Q1 came in below estimates at 2.2%, which has sparked some modest selling. Most financial and commodity markets have performed extremely well this week, despite a rash of negative economic news, and today’s response to lackluster GDP will give us a good look into the market’s mood heading into May.

Energy futures remain stuck in limbo, with WTI and HO now ready to challenge the top end of their recent trading ranges while RBOB lags behind. Seasonal trends suggest we’re due for a 10-20% drop in prices over the next few months, although it is still too early to say that prices have peaked, as May has often seen the highest prices of the year.

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Reading Between The Lines

On April 26, 2012 by TradingDesk
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The big FED’s FOMC announcement yesterday used a lot of words to say nothing new, and market watchers are still working this morning to read between the lines. After finishing with solid gains yesterday, most global equity markets are selling off today. The parade of negative economic news continues from Europe, and was joined by another increase in US jobless claims this morning, and a decline in the Chicago Fed’s business activity index. With 3 trading days left in the month, there’s not much more time to take advantage of the old adage to Sell by May, then go away.

Energy prices were knocked around all day by rumors that Iran was shelving its nuclear program, a mixed DOE report, and the FED’s statement, but ultimately followed stocks and drifted higher into the close. Products are moving fractionally higher this morning, back into the middle of their recent trading ranges. WTI remains in the red, still reeling from the glut of inventory at Cushing in yesterday’s report. Technical studies remain mixed, with a slight edge to the bears, but without a catalyst to provide further direction, its seems that we’ll be stuck in this range for a while.

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DOE Weekly Report

On April 25, 2012 by TradingDesk
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Click below for a PDF of this morning’s weekly DOE inventory levels…

DOE Weekly Report

Buckle Up…

On April 25, 2012 by TradingDesk
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Commodity markets were up 1% 30 minutes ago, then the durable goods order report from March showed the lowest level of orders since the trough of the recession in early 2009, and markets have crumbled. The move is a very fitting one as we await the FED announcement this afternoon as economic challenges around the world have been battling central bank policy for control of the markets all year.

The DOE report is out at 9:30, and the FED announcement is expected at 1:15. With Iranian rumors running rampant in between, expect an exciting and volatile day.

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Off To A Quiet Start…

On April 24, 2012 by TradingDesk
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We’re off to a quiet start, product prices have had only a 2 cent range so far, as Europe takes a sigh of relief after successful bond auctions overnight. The day’s schedule is filled with economic data points, and it seems like traders are content to wait and see how those turn out before making a move, and many may simply stay on the sidelines until tomorrow’s FED announcement.

RBOB pulled back from the brink yet again yesterday, after touching a new low for the month, and staged a late rally, relieving its oversold technical condition. WTI and HO managed to bounce off of support levels as well, and remain near the middle of their trading ranges. The Iranian Oil minister said that damage was avoided in the cyber-attack on their main oil terminal, which has helped pushed Brent crude into the red today.

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A Red Flag Morning Across the Globe

On April 23, 2012 by TradingDesk
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It’s a red day across most of the globe, after negative economic headlines from Asia and Europe have flipped the risk off switch. Chinese PMI shows that factory activity continues to contract, Spain is officially in a recession, and Euro-zone debt hit a record high.

Energy prices are slipping along with equities and the Euro, although losses have been tempered by a Reuters headline that said Iran’s largest oil terminal was hit by a suspected cyber-attack. The severity of this attack may provide direction for prices, at least until the FED meeting. The speculative long interest in RBOB, which has remained near record levels for months, fell again last week as the contract dropped 20 cents. Gasoline futures remain the weakest technically, and are targeting a move to $3.00. HO futures continue to hold above support in the $3.9-$3.10 range.

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Equity and Commodity Markets Survived Risk-Off Trading.

On April 20, 2012 by TradingDesk
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Equity and commodity markets survived another round of risk-off trading Thursday, and the sentiment has turned positive this morning. European markets are leading the way higher, buoyed by a German business confidence survey and news that France is on the verge of giving Nicolas Sarkozy the boot in upcoming elections. Hints that China is willing to provide more monetary easing to ease the pain of its housing slowdown, and reports that the IMF will boost its bailout funds (The US being the primary source of funds) has also helped push the dollar lower and risk assets higher so far.

RBOB continues to draw the most attention in the energy complex, with the sellers out in force again yesterday. This week’s action has turned the gasoline contract from the strongest contract in the energy space, from a technical perspective, into the weakest. HO and WTI continue to hold support, which leaves the window open for higher highs in 2012.

 CLICK HERE for a PDF of this morning’s charts.

Energy Prices On The Cusp Of Meltown Then Recovered.

On April 19, 2012 by TradingDesk
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Energy prices were on the cusp of a major meltdown Wednesday, but once again, major support levels held and prices recovered. RBOB was the standout on the day, dropping nearly a dime in early trade, then bouncing 7 cents into the close after it filled its rvp rollover gap on the charts. The action is very similar to a week ago, so it’s too early to say that the selling is finished, although it does appear that after shaking out some of the weak hands, the fund money is ready to keep a bid in our market.

The DOE report had some positive signals for refined products, the most notable was that exports from the US broke the 1 million barrel/day mark. That level is especially impressive considering that the US was a net importer of refined products for more than 50 years, and has just recently shifted its position. The improving domestic fundamental data helped product spreads to rally after heavy selling early in the week.

Financial markets are showing some life this morning after Spain dodged a bullet in its most recent debt auction. While the prices they paid were the highest of the year, there were many who feared that buyers would stay away all together. Weekly jobless claims disappointed again, rising to 386,000, while the statistically impossible trend of prior-week revisions continued with last week’s value rising from 380,000 to 388,000.

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DOE Report April 18, 2012

On April 18, 2012 by TradingDesk
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This week’s report is ready to view.  Click the link below.

CLICK HERE for a PDF of the DOE Weekly Report

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