Light Sweet Crude
The CL contract found itself down for the day on Monday, but remains above the $90 a barrel level, a support level that we feel is vital to keep the bull run going. The market looks set to tread water between $95 and $100 for the near-term, and will need to break above the $100 mark, or fall to $90 to get us to buy again.
The Brent market is clearly treading water just below the $120 area, and looks as if it wants to rise in value, but something is clearly holding that move back. One thinks when seeing this chart that when we get the breakout above $120 that the move should be explosive. We buy on a close above that mark, and on dips.
Oil Fundamental Analysis for July 19, 2011
Crude oil pricesretreated on Monday, as rising concerns over debt problems in Europe and the United States dampened demand for higher yielding assets, including crude oil. Moreover, speculations mounted that the International energy Agency will draw further oil reserves by releasing more of its emergency reserves as they will meet next weekend.
Traders will be focused on the latest developments in the United States regarding the debt ceiling deal , and the latest developments in Europe regarding the region’s debt crisis, where EU leaders are due to meet on Thursday, but until then, it seems pessimism will continue to dominate markets, and accordingly, we maintain our bearish outlook for crude oil prices.
Tuesday July 19:
The Housing Starts report is due from the United States at 12:30 GMT where starts are expected with 2.7% rise in June to 575 thousand from 560 thousand; building permits on the other hand are expected with 1.5% drop to 600 thousand from 612 thousand.
Natural Gas Technical Analysis for July 19, 2011
The natural gas market found itself in a fairly whippy situation as the market both rose and fell during the trading session on Monday. The candle at the end of the day looks like a long-legged doji. The trade set up is easy to see: If we break the top of the session’s highs on Monday, it’s a buy. If we break lower than the Monday low, the market should pull back, perhaps to the $4.40 area as that is massive support.
Natural Gas Fundamental Analysis for July 19, 2011
Natural gasprices rose slightly on Monday on expectations of warm weather conditions in the United States, since it will increase speculations of rising demand for power-plant fuel to meet rising cooling demand.
Warmer weather conditions should provide natural gas prices with more momentum to rise on outlook of rising demand for natural gas.
Gold Technical Analysis for July 19, 2011
The gold markets rose again on Monday as investors are buying the traditional safe haven assets like gold and the Swiss Franc. The market has broken out of the recent trading ranges, and appears to look like a market that wants to go to $1,625 based upon the recent rectangle that we have just exited. We buy on dips, and never sell gold.
Gold Fundamental Analysis for July 19, 2011
Goldcontinued the upside rally on Monday and struck the awaited record above $1600 mark on rising uncertainty and demand for haven with the mounting losses and doubt that the debt crisis will be resolved.
Investors were downbeat on the prospects of a near-term solution to the Greek agony that is threatening the overall stability of the euro area and financial markets globally with the risk of contagion rising as the leaders stall in a solution.
The focus turned now to the euro area leaders’ summit in Brussels on July 21 where investors had little hope that a new solution is to be proposed. The market also continued to react to the stress test results where eight lenders fell short of minimum requirements and 16 others need to bolster capital further.
Fears over the deadlock in the United States over raising the debt ceiling also persists which is further intensifying risk aversion and keeping the pessimism strong. The gold on Tuesday will be haunted by the same negativity and jitters as the focus remains on Thursday’s summit which will keep the upside support for the metal evident though volatility and fluctuations might be seen with gold trading at new all time records at the psychological $1600 mark.
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