After a strong week of price gains in the energy complex (as well as most other commodity markets) the complex is starting this week with only minor losses so far in overnight trading. Last week saw mostly bearish new, however, the market focused mostly on the few supporting items keeping WTI prices near the psychological summit of $100/bbl.
The bullish drivers were a weakening dollar, concern over Geopolitical issues (like Nigeria & Venezuela) that could cause a supply interruption and a strong technical trading pattern. None of these drivers are overwhelmingly supportive but interesting enough to keep the market sentiment and the momentum biased to the upside.
We expect the market will continue in this pattern for at least another few weeks and/or until the current overvalued price scenario runs out of steam and recognizes that the majority of the energy complex drivers do not support current levels. Volatility should remain high and prices remain susceptible to sudden strong reversals on little notice.
Currently the complex is mixed.
| Current Expected Trading Range | | | ||
| | 2/25/08 | Change | Upper | Lower |
| | | From | Resistance | Support |
| | 7:00 AM | Yesterday | | |
| Apr WTI | $98.56 | ($0.25) | $100.00 | $85.25 |
| Mar HO | $2.7545 | ($0.0085) | $2.8000 | $2.4000 |
| Mar RBOB | $2.5287 | ($0.0050) | $2.6500 | $2.2000 |
| Mar NG | $9.300 | $0.154 | $9.250 | $8.250 |
| | | | | |
Dominick A. Chirichella
Energy Management Institute
tel 646.202.1433
fax 801.383.7510
www.advancedenergycommerce.com
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