Oil sees $104 as line in the sand

KEY TERMS

OVB Outside Vertical Bar
VRCB Volatility Reduced Compression Bar

ENERGIES

Brent Crude Oil (November ‘13):

Short Term Trend is bearish.
Confirmation of a top with a range violation on 09/09/2013 @ 113.31. Confirmation of a top with a close violation on 09/09/2013 @ 112.33. Downside Targets = 104.36 – 102.84
VRCB generated on Friday.

November Brent Crude gave back most of its gains from mid-week as it moved into the weekend but was able to hold its ground more successfully than WTI as the short-term support trendline captured the lows of the week once again.
While Brent is still a stronger market than WTI at the moment, it will still likely face pressure if it trades above $110 and likely fall into the downside support zone also listed on the chart where the market would then be a screaming buy.

WTI Crude Oil (November ‘13): (NYMEX:CLX13)

Short Term Trend is bearish.
Confirmation of a bottom with a range violation on 09/12/2013 @ 108.96. Confirmation of a top with a close violation on 09/10/2013 @ 107.39. Downside Targets = 105.76 – 104.53.

November WTI Crude Oil dropped back near the lows of the week heading into the close following the mid-week pop and came within just $0.50 of generating an IT confirmation of a top with a close below $104.21.
WTI closed below the low of the week for first time since May and once it breaks the $104 threshold it will likely move lower for the coming weeks toward the downside price targets listed above as well as in the chart sent out mid-week.

Natural Gas (October ‘13): (NYMEX:NGV13)

Short Term Trend is bearish.
Confirmation of a bottom with a range violation on 08/12/2013 @ 3.327. Confirmation of a bottom with a close violation on 08/14/2013 @ 3.342. Upside Targets = 3.461 – 3.534
Possible partial confirmation of a top with a range violation @ 3.655. Possible confirmation of a top with a close violation @ 3.655 or lower.

October Natural Gas ran stops above the previous week’s high during last week’s trading as it generated a 99% retracement from the July highs before dropping to close in the lower 1/3 of the weekly trading range and nearly flat on the week.
After rallying for 31 days without a significant correction, the natural gas ST long trade has entered into the top .15% of statistical outliers in terms of duration as it’s considerably overdue for a move lower with an initial downside target of 3.476.

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