Oil Technical Analysis for July 8, 2011
Light Sweet Crude
The CL rose on Thursday, pushing past the $97.50 area, and looks like it is trying to get to $100 in the short-term. We have shown massive bullishness, and it appears that we will continue to go north. We like buying dips, and don’t sell at this point.
If the CL had a good day, the Brent market had an outstanding one. The candle is long, green, and full. This is a great sign that the bullishness is a new phase of buying, and it appears that $120 is a given at this point. We buy dips, or closes above the $120 mark at this point.
Oil Fundamental Analysis for July 8, 2011
Crude oil prices rose on Thursday despite the lower than expected drop in crude oil inventories as reported by the EIA, as better than expected labour data from the United States boosted confidence and led investors to target higher yielding assets, moreover, investors were feeling optimistic over the outlook for economic growth amid signs economic activities could pick up in the second half of this year.The ADP employment report showed U.S. private employers added 157,000 jobs in June, well above median estimates of 70,000 jobs, while the EIA report showed that crude oil inventories fell last week by 0.9 million barrels, above the expected drop of 2.5 million barrels, and following a drop of 4.4 million barrels in the prior week.
Investors will be eyeing key data from the labour market in the United States, where the U.S. Non-farm payrolls are expected to show U.S. employers added 105,000 jobs in June, and if the Non-farm payrolls show similar strength to that shown in the ADP, we should expect crude oil prices to extend the rise on Friday.
Friday July 08:
Canada’s jobs report will be released at 11:00 GMT, where the unemployment rate is expected to remain unchanged at 7.4% in June, while the net change in employment is expected to show a rise by 15.0 thousand jobs, compared with the prior rise of 22.3 thousand jobs in May.
At 12:30 the jobs report will be the focus for the current state of the labour market. The Nonfarm payrolls are expected at 105,000 following 54,000 and unemployment to hold at 9.1%.
Private payrolls are expected to rise to 125 thousand following 83,000 and manufacturing payrolls to maintain the weakness and rise by 5,000 jobs only.
At 14:00 the wholesale inventories is due for May and expected at 0.6% following 0.8% and at 19:00 GMT consumer credit also for May is expected to slow to $4.0 billion from $6.247 billion.
Natural Gas Technical Analysis for July 8, 2011
The natural gas markets fell hard on Thursday, but managed a bounce in late trading. Because of this, we have formed a hammer-shaped candle on the daily chart, and right where you would want to see it. The $4 mark has held, and it looks like we may see buying come into the marketplace. The breaking of Thursday’s highs would be a buy signal, and a sign that we may reenter the previous consolidation area between $4.20 and $4.40 or so.
Natural Gas Fundamental Analysis for July 8, 2011
Natural gas pricesfell on Thursday after the EIA report for natural gas inventories showed a bigger than expected rise, where natural gas stockpiles increased last week by 95 billion cubic feet, compared with median estimates of 82 BCF, and the prior estimate of 78 BCF, which put strong downside pressure on natural gas prices.Moderating weather conditions should keep the negative pressure on natural gas prices , since demand for power-plant fuel will ease, and that should pressure natural gas prices to drop.
Gold Technical Analysis for July 8, 2011
The gold markets rose again on Thursday, but slowed their progress. As a result, we actually saw the market go negative at one point. However, as buyers came back in, it formed a hammer on the daily chart. It looks a lot like the $1,525 level is set to hold at the moment. However, with non-Farm Payroll coming later in the day, we think that the market is on hold until we see what comes of the numbers. We like buying, especially on dips.
Gold Fundamental Analysis for July 8, 2011
Thursday was not as much of a positive day for gold with slowing haven demand on eased jitters, which stripped the metal of upside support.
On Thursday market jitters eased with the ECB’s decision to suspend the minimum credit-rating threshold on Portuguese government debt which is used as collateral in the refinancing operations as the ECB is confident in their financial program and their commitment to austerity measures, boosted confidence in the market and eased debt woes.
Further support to the sentiment was seen from the upbeat ADP figures that eased jitters for Friday’s jobs figures, which also pressured the metal to maintain a tight trading range.
On Friday, Asian markets are expected to trail the positive sentiment which already was seen on Thursday as they downplayed the chances for China to raise rates again this year which was also negative on Gold. The metal will fluctuate on the back of the jobs report and eased debt woes, if the sentiment remains as positive as it was initially in reaction to the ECB’s decision.
The metal is pressured by the eased jitters and losing grounds even with a weak dollar, which if the jobs figures came also positive tomorrow might further pressure the metal on the positive sentiment and reversing from haven demand, though some upside support will be seen from
rising commodity pricesand a soft dollar, which is limiting the downside pressure.
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