Crude oil future (March) prices witnessed a rally on Wednesday’s trading session and after making a high of 3707 it settled at 3689 levels.
It’s sjown a stiff resistance at 3730 levels on breach of the same likely to trade higher. The supports are at 3660 then 3630 levels.
We at fxcommodity expect prices to trade sideways to higher and recommend buying near support levels.
MCX Crude Oil Tip
Buy March at 3675
Tgt 3720
SL 3650
Popularity: 7% [?]
Feb 17
Technical Recap
Bulls really controlled the action last week beginning with a boost off of the 200-day moving average followed by reinforced settlements above the crucial $72.50 benchmark area. Prices trended higher for the week through Thursday to $75.70 before pulling back on Friday on a round of profit taking ahead of the 50 and 100-day moving averages. The market closed firm on the week just above the 7-week dowtrend channel at $74.00 level with a minor uptrend potentially developing early this week.
We are still maintaining settlements below the broken key longer term Quarterly trend lines at the $77.00 to 78.00 range leaves the market vulnerable to renewed selling. With options expiration on Today (Wednesday), we anticipate rallies early this week, and then begin fade against $78.00 to 80.00 leading to a turnover later in the week.
Technical Outlook
Upside:
The market reversed the 7-week downtrend to start the week off rallying off the $74.00 level on Tuesday. Maintaining settlements above $74.00 to 75.00 supports advances this week targeting the key broken Quarterly trends in the $77.00 to 78.00 range. Trade or settlements above $78.00 brings the $80.00 psychological mark easily in range for the week. Any settlements above $80.00 will provide solid Bullish reinforcement with the potential to propel the market back to the Jan 2010 highs at $84.00. If momentum fades out in the $77.00-78.00 range, longs should cover all positions.
Downside:
Failing rallies at the $77.00-78.00 range generates a sell signal for an initial drive back to the broken 7-week downtrend at $74.00. Settlements below $74.00 reinforces short term weakness as it puts prices back the weekly downtrend channel while violating the minor daily uptrend. The objective below $74.00 is placed at the key $72.50-71.75 Support range where shorts should initially scale back positions. Trade and settlements below $72.50-71.75 will rekindle sustainable Bear forces triggering sell offs targeting the current 2010 lows at $70.00 to 69.50 while bringing the next major objective in range at $68.50-68.00. A settlement below $70.00 on the week, or trade that takes out the $68.00 level, lines up for $65.00 oil in the coming weeks.
Whats Making the News
Popularity: 7% [?]
Jan 11
Crude oil prices rose to a new 15 month high on speculation that fuel demand will rebound as freezing temperatures in the northern hemisphere and weakening dollar also supported the prices.
The oil advanced for the second day as Chinese crude imports climbed to a record 203.8 million metric tons last year weighing over weak last weeks weak US NFP data. Chevron corp, the second largest US energy producer said the Makaraba-utonana pipeline it operates in the southern Nigeria’s delta state was breached on Jan 8, affecting 20,000 barrels of crude oil production a day. Attacks by armed groups in Nigeria’s oil rich delta region have cut the country’s output by more than 25 percent since 2006. Crude Feb month contract was trading at $83.5 gaining 1.57 percent. Crude oil mcx Dec contract was trading at Rs 3790 gaining 0.03 percent.
Copper futures prices rallied for the first time in last three days as Chinese imports and weak dollar boosted investors confidence in the metal. The china imported 369,368 metric tons of copper and its products in December, 27 percent increase from November. The Chinese exports of all products climbed for the first time in 14 months, according to census bureau. LME copper inventories rose by 4575 metric tons and mcx copper is trading at 348.10 gaining 0.96 percent.
GOLD MCX Feb
While above 17000 prices could stay firm and could target 17080/17125 followed by 17250 levels. Unexpected fall below 16978 could see a move lower towards 16920 followed by 16870 levels.
Res: 17080/ 17160 Supp: 16970/16920
Silver MCX Mar:
As long as 28320 holds, prices could move up and find resistance at 28600 initially followed by 28730/29000 levels. If unable to hold 28300 expect a corrective move towards 28150/27980.
Res: 28610/28730 Supp: 28300/ 27980
CRUDE MCX Jan
Dips to 3763 may find support for a rise towards 3805 initially. Rallies above 3812 could invite fresh rallies towards 3848/3878. Falls below 3752 may cause doubts on the bullish view.
Res: 3812/3870 Supp: 3762/3736
Natural Gas MCX Jan
As long as support at 251/249 holds prices could stay firm and edge higher towards 258/261 followed by 264. Falls below 249 may negate the view and target 241.
Res: 258/264 Supp: 254/247
Copper MCX Feb
Dips to 347/345 hold downside expect to move up and find resistance at 349/350.50 followed by 354. If unable to hold 345 drag prices lower towards 343/341 levels.
Res: 349/351 Supp: 347/ 345
Lead MCX Jan
As long as 118.70/120 caps the upside expect a corrective fall towards 117/116 followed by 115.30. Needs to break 120 to negate the view.
Res: 118.70/120 Supp: 117/ 116
Nickel MCX Jan
Moves to 844 may find resistance for a fall towards 831/826. Break below 825 could invite fresh sell off towards 814/802. Needs to break 847 to negate the view.
Res: 845/862 Supp: 831// 824
Zinc MCX Jan
If 118 cap the upside expect a fall towards 116.50/115.50. Need to break 118.70 to negate the view.
Res 118/119 Sup: 116.70/115
Aluminium MCX Jan
If 105 expects to move up and target 106/106.80followed by 107.60 Needs to break 104.20 to negate the view.
Res: 106.20/107 Sup: 105/104.40
Popularity: 53% [?]
Jan 6
Crude oil rose as cold weather was seen boosting heating demand, Russia and Belarus feuded over oil pricing and signs of manufacturing strength fed hopes for more energy demand.
Global oil consumption will average 85.22 million barrels a day this year, the Energy Department said in its monthly Short- Term Energy Outlook on Dec. 8. That is down 1.1 p.c. from a record 86.14 n barrels a day in 2007.
Crude oil for far-month March contract rose by Rs 20, or 0.52 per cent, to Rs 3,845 per barrel with an open interest of 190 lots.
The oil for delivery in January also edged up by Rs 16, or 0.42 per cent, to Rs 3,782 per barrel in 13,364 lots.
Marketmen said increased buying activity on firming global trend mainly led to rise in crude oil futures prices.
Now support for the crude is seen at 3731 and below could see a test of 3697. Resistance is now likely to be seen at 3789, a move above could see prices testing 3813.
Trading Tips:
Crude trading range is 3700-3820.
Crude oil rose as cold weather was seen boosting heating demand
Crude oil is now having support at 3740 and resistance at 3802 level
Global oil consumption will average 85.22 million barrels a day this year
BUY CRUDE JAN AT 3750-3765
SL 3732
TGT 3778-3790-3805-3835.
Popularity: 64% [?]
Jan 4
Crude managed to hit a high of $80 on the last trading day of the year as investors remained upbeat about the demand prospects in near term and falling inventories lifted the sentiments up. The commodity once again nudged near its highest level in the year after the US crude inventories slid further, extending the recent drawdown. On New Year’s eve, Nymex February West Texas Intermediate hit the $80 mark before settling well above at $79a barrel, a rise of 78 per cent in 2009.
U.S. Department of Energy (DOE) said that crude oil supplies were down 1.5 mn barrels to 326.0 million barrels. Supplies of gasoline were down 300,000 barrels and heating oil supplies were down 1.9 million barrels. The DOE also said that refinery use increased from 80.0% to 80.3% of capacity last week. Over the past four weeks, gasoline demand was up 1.1% from a year ago while distillate demand was down 2.8% from a year ago. The domestic crude oil production, meanwhile fell for a fifth week in a row to 5512 thousand barrels as on week ended 25 December 2009 compared to 5524 thousand barrels in previous week.
This ensured that oil recovered bulk of its lost ground and ends the year on a high note. Earlier in the month, fueled by S&P’s downgrade of Greece’s credit rating and the possibility of more downgrades of Euro Zone sovereign debt, particularly Spain and Ireland, dollar surged to a fresh 3 and half month high against the Euro. Oil had briefly fallen under $70 following the dollar’s exuberance and a persistent slide in US inventories. Tensions in Iran between opposition supporters and the government and by cold winter weather in the US assisted the commodity further even as the other markets remained trapped in the year end lull.
MCX Crude oil futures went up above Rs 3700 per barrel as the year end approached and looks likely to be in for a fresh rally in case the mark holds. The prices should gain some more ground given that the expiry in still around two and half weeks away and fresh longs could be seen getting build if the global prices snap pass $80 barrier.
Popularity: 52% [?]
GOLD FUTURE
(Last traded Price 16638)
The counter after gap down opening yesterday failed to move higher on weak global advice and remained range bound for the major part of the session except earlier to closing hours when it surged to day’s high at 16705, which however, remained short lived and the gold slipped back in closing minutes. The counter may remain volatile today taking cues from the world markets. The gold as appears on charts may slip further to 16574/16534 once it trades and remains below 16609. Strong resistance for the gold exists at 16678 which if crossed with volumes then the gold may move up to 16707/16726.
DOW JONES (LAST CLOSE 10548)
LONG ON DOW @10410 ON 21-12-09. NOW SL IS 10515. SELL IT BELOW 10515
COPPER (LAST CLOSE 344.65)
SELL COPPER BELOW 341 WITH SL OF 348.
CRUDE OIL
LONG ON @ 3290 ON 15-12-09. NOW SL IS 3685 . SELL IT BELOW 3685
GOLD
(LAST CLOSE 16652 )
SHORT ON GOLD @17070 ON 17-12-09 . NOW HOLD SHORT WITH SL OF 16725.
NATURAL GAS JANUARY
(LAST CLOSE 271.80)
LONG ON NG @274 ON 28-12-09. HOLD NG LONG WITH SL OF 266.
SILVER
(LAST CLOSE 26657 )
SHORT ON SILVER @27290 ON 29-12-09. NOW HOLD SHORT WITH SL OF 27005.
Popularity: 61% [?]
Dec 27
| Month | Date | Forecast Value |
50% Correct +/- |
80% Correct +/- |
| 0 | Nov 2009 | 78.1 | 0 | 0 |
| 1 | Dec 2009 | 74 | 6 | 13 |
| 2 | Jan 2010 | 85 | 7 | 16 |
| 3 | Feb 2010 | 92 | 8 | 18 |
| 4 | Mar 2010 | 104 | 9 | 20 |
| 5 | Apr 2010 | 110 | 9 | 21 |
| 6 | May 2010 | 110 | 10 | 22 |
| 7 | Jun 2010 | 107 | 10 | 23 |
| 8 | Jul 2010 | 103 | 11 | 24 |
Updated Friday, December 18, 2009
Analysts expect crude oil futures to trade around $75 to $80 during the early months of 2010 and may go above $90 later in the year as the global economy recovers from the worst economic slump since the Great Depression.
These prices give plenty of comfort to producers. Opec, the producers’ cartel, has said $75 a barrel is its target, while even deep-water specialists such as BP, Shell and Petrobras can continue drilling in expensive offshore regions at a much lower price.
Popularity: 69% [?]
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