Commodities Technical And Fundamental Analysis For July 21, 2011

Oil Technical Analysis for July 21, 2011

Light Sweet Crude

The CL contract was very quiet on Wednesday as traders simply are content to trade back and forth in a tight range. The overall bias is to the upside, but it should be said that the $100 level looks formidable as a barrier. Buying on dips is what we recommend unless we can break the $95 level, which would have us looking for $90 in short order.


The Brent market was slightly more positive on Wednesday than its cousin the CL contract, but only just so. The market is still bumping up against the $120 level, and you would have to admit – it seems like it doesn’t want to go lower, as it simply just sits there. We like buying a close above $120, or even on dips. One feels that as soon as the $120 level gets broken – we are going straight up from there.

Oil Fundamental Analysis for July 21, 2011

Crude oil pricesextended the rise on Wednesday, as the EIA report showed crude oil inventories fell last week below expectations, where crude oil inventories fell by 3.7 million barrels well below the expected drop of 2.0 million barrels. Moreover, speculations that the IEA will release more inventories from its emergency reserves eased, which provided crude oil prices with some bullish momentum.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 if the current optimism continues to spread through markets, we should expect crude oil prices to extend the gains on Thursday.

Thursday July 21:

The US will start Thursday as usual at 12:30 GMT with the weekly jobless claims, which are expected to rise to 410 thousand after they eased the previous week to 405 thousand.

At 14:00 GMT the Leading Indicators for June are due and expected to ease to 0.2% from 0.8%. At the same time the Philadelphia Fed Index for July is also due and expected with improvement to 2.0 rebounding from -7.7.

Natural Gas Technical Analysis for July 21, 2011

The natural gas markets fell on Wednesday, dropping down to look for support. The afternoon in US trading found buyers coming in at the $4.40 mark, and only confirms how serious the support area in that area really is. We like buying dips, as this market seems to be content to trade between $4.20 and $4.80 or so.

Natural Gas Fundamental Analysis for July 21, 2011

Natural gasprices dropped on Wednesday on expectations of milder weather conditions in the United States next week, noting that natural gas prices have been rising on warmer weather conditions, since it will increase speculations of rising demand for power-plant fuel to meet rising cooling demand.Milder weather conditions should put negative pressure on natural gas prices on Thursday, especially since natural gas prices have been rising recently amid the heat wave that spread through the Mideast and East of the United States. Nonetheless, the EIA report for natural gas inventories is expected to show that natural gas stockpiles increased by 62 billion cubic feet above the 55 BCF increase for the same week last year, and markets will be closely watching the release.

Thursday July 21:

At 14:30 GMT, The EIA will release the weekly natural gas storage change for the week ending July 15, which is expected to show that natural gas stockpiles increased by 62 billion cubic feet, compared with the prior report that showed natural gas inventories increased by 84 billion cubic feet.

Gold Technical Analysis for July 21, 2011


The gold markets had a very bullish day on Wednesday, as the market initially fell, but then bounced back towards the afternoon session in America. This shows just how supported the market is. However, it should be noted that we certainly have seen a lot of buying recently, and a pullback is very much needed. We will be looking to buy on dips, as that strategy continues to work out.

Gold Fundamental Analysis for July 21, 2011

Choppy trading prevailed for goldon Wednesday as the sentiment and risk appetite improved slightly on eased woes and good earnings which sent equities higher and directed demand away from the haven.Investors were less pessimistic as the US approached a deal on raising the debt ceiling and the fears eased ahead of the European summit on financial stability.

Still, the sentiment for Thursday will be dominated by the euro area leaders meeting in Brussels and whether they will meet expectations for strong resolution of the debt crisis and financing Greece and if they reached a good deal on the involvement of the private sector that averts selective default status by rating agencies.

Investors continued the profit taking ahead of the summit and with the rising hope that a solution will be found on Thursday by the leaders the gold might continue the downside correction and extend the decline, though volatile trading will prevail.

Shall the euro area leaders fail to mend the gap over how to finance Greece and the expand the scope of the EFSF markets will be pressured again by pessimism and weak decisions will only renew the selloff and support gold again to regain the bullishness to new records.

It will be a very decisive day for the sentiment and the trend over the interim and as Papandreou called it, the euro area leaders can either “make or break” it with the decision!

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