Crude Futures: Crude prices went out with a bang last week ripping to 7673 before closing at 7645 with gains of $2.20 for Friday’s session. The market gained $1.85 week on week with the Bulls taking control of the near term action. Overnight action continues higher ahead of the pit open with a Bullish outlook to start the week off. A turn below the 7550 level negates the Bullish outlook with the potential to shift the outlook Bearish thereafter.
For today, trade is set to potentially Gap open higher into the pit session offering initial buying opportunities on dips against 7675-7630 X Support. Trade holding X Support is clearly Bullish, however, buyers can maintain buying operations until 7550 is violated. Near term objective is at 7740-7750 X Resistance while trade above 7750 triggers subsequent rallies to 7800-7840 XX and 7900 XXX Bull targets.
On the downside, sellers can lightly scalp against listed Resistance zones and with momentum up, should take modest gains off the table. If we slip below 7630, expect lower Supports to be challenged at 7595 XX Pivot and 7570-7550 XXX. A punch through 7550 is expected to trigger Bear sweeps to 7500-7435 XXXX lower extended target range.
Crack Spreads: The cracks trended lower last week from their spike highs seen last Tuesday with Friday’s session posting a loss for both while erasing nearly all of the weekly gains. Heat and Gas are both in short term daily downtrends and are trading below their weekly uptrends to start the week off with a Bearish outlook.
The Heat Crack momentum is down ahead of the pit session open with a sell rallies approach suggested into the open. We’re viewing failures against 1180-1200 X Resistance as a clear sign selling will continue, however, rallies can be sold up to 1215-1230 XX Resistance. Drives below 1150 will target overnight lows at 1120 XX Support and likely extend declines to 1100 XXX Support today.
On the upside, trade holding inside Friday’s range off the open above 1150 offers minor buy scalping using the 1180-1200 X Resistance target to cover. Upside action above 1230 weekly Pivot/Friday’s high negates the Bearish outlook and shifts tides to the Bulls with 1260 XXX Resistance target likely to be attained.
The Gas Crack looks weak overnight with trade below 645-660 X Resistance providing Bearish signals for the session. Short failures against X Resistance and/or look for trade below 600 to spur sell offs to 585-575 XX to 550-535 XXX Support targets.
On the upside, trade holding the 600 level into the pit session can be scalped by buyers using the 10 DMA at 620 to cover as well as trailing Stops for potential moves to 645-660 X Resistance. Trade above 660 neutralizes the Bear bias with a moderate chance to jump to 700-705 XX Resistance, however, only trade above 705 puts control back in the hands of the Bulls with 733-740 XXX in range for the session.
Natural Gas futures:Natural gas prices rose on Friday after the previous session posted a triple bottom at the 3700-3690 Support range. The market attained highs at 3939 before sliding back on minor profit taking to close at 3883 with gains of 11.5 cents on the day. The chart patterns continue to show flagging congestion with Mixed to Higher bias as the week opened above the 5-week downtrend line at 3800 and looks to be starting a 4-week uptrend at 3745.
Buyers today can look to buy dips against 3800 X and 3770-3745 XX Support levels as trade holding above the 4-week uptrend favors continued testing of 3915-3946 XX Resistance target. Trade above 3946 sets off a breakout leg targeting 3985-4000 XXX for today and towards 4100-4200 in the days ahead.
On the downside, sellers can scalp against today’s initial X Resistance at 3840-3865 with Stops above 3883 Settlement suggested while using the 3800 X and 3770-3745 XX Support targets to cover, or short another rejection inside the 3915-3946 XX Resistance zone, stopping out above 3955. Downside follow through below 3745 alerts for a shift in tides to the Bears to retest last week’s and Sept low at 3703-3693 XXX with and increased chance to challenge 2010 Spot lows at 3620.
Dec S& P Futures:Equities went out strong last week with the Dec contract closing just off its best levels at 1105 on Friday after reversing sell offs earlier in the week. The market is set to Gap open higher into Monday’s primary session with a Bullish outlook today.
Trade holding above the 200 DMA at 1113 favors continued rallies early on with objectives at 1118-1120 X to 1123-1125 XX and overall 3Q highs at 1128-1130 XXX. If we open below the 200 DMA at 1113, be on guard for early drives to fill the Gap while waiting to buy the pullback against 1107-1103 XX Support range.
On the downside, sellers can scalp an open below 1113 using Stops above 1115 and a target at 1107-1103 XX Support. Follow through below 1103 will sustain drives to 1099-1096 XXX Support. Otherwise, the listed Resistances above are expected to provide decent short scalping plays as longs will be looking at those levels to take profits.
Dec Gold Futures: Gold prices traded mixed on Friday but ended the session lower by $4.40 at 12465 as last Wednesday’s Double Top Doji reversal candle at record highs keeps the action on the defensive and outlook Bearish. Trade is in a 4-day downtrend channel and under pressure early Monday morning with a sell rallies approach suggested until we’re trading above 12550. Trade moving below 12430 X Support is expected to retest last week’s Sept low at 12400-12379 XX Support and likely follow through to 12330-12300 XXX Support target.
On the upside, buyers can lightly scalp against listed Support levels and cover on minor pops or attempt to use a trailing Stop method in the event short covering kicks in. Use X and XX Resistance for targets on longs. Trade above 12550 violates the 4-day downtrend and should trigger rallies to 12605-12615 XXX Resistance with record highs back in range at 12648.