Crude Oil, Gold Sink as Eurozone Fears Spark Risk Aversion

Crude oil and gold prices are under pressure as Eurozone stability jitters drive market-wide risk aversion and encourage safe-haven flows into the US Dollar.

Talking Points

Crude Oil, Copper Lower as Eurozone Crisis Fears Drive Risk Aversion Gold and Silver Under Pressure as US Dollar Gains on Safe-Haven Flows Commodities are facing broad-based selling pressure as risk aversion grips financial markets. The catalyst for the selloff seems to be found in the Eurozone, where a sharp widening in the spreads between Italian and Spanish 10-year bond yields and their benchmark German counterparts points to swelling sovereign risk. Broadly speaking, the tense atmosphere seems to reflect unease with the implications of the Cyprus bailout deal, as expected.

Sentiment-sensitive crude oil and copper are following stocks lower. Meanwhile, gold and silver are facing de-facto selling pressure as the US Dollar finds its way higher on the back of renewed safe-haven demand. S&P 500 index futures are pointing sharply lower ahead of the opening bell on Wall Street, hinting more of the same is likely ahead. US Pending Home Sales figures headline the data docket from here, with expectations calling for a 0.3 percent month-on-month decline in February.

WTI Crude Oil (NY Close): $93.71 // +1.26 // +1.36%

Prices are testing resistance at 96.41, the 50% Fibonacci expansion. This barrier is reinforced by a falling trend line set from late January. A break above that exposes the 61.8% Fib at 98.09. Near-term support is at 94.74, the 38.2% level.

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Gold (NY Close): $1608.58 // -6.30 // -0.39%

Prices are testing support at 1597.77, the 14.6% Fibonacci expansion, a barrier reinforced by a rising trend line set from late February (1594.53). A break below that exposes the 23.6% level at 1586.27. Near-term resistance is at 1616.98, the March 21 high, with a reversal above that aiming for a longer-term falling trend line at 1639.94.

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Silver (NY Close): $28.74 // -0.44 // -1.49%

Prices are testing below support at 28.46, the 23.6% Fibonacci expansion. A break below that exposes the 38.2% level at 27.86.Near-term resistance is in the 29.42-92 area, with a break higher exposing a falling trend line now at 30.13.

Daily Chart - Created Using FXCM Marketscope 2.0

COMEX E-Mini Copper (NY Close): $3.466 // +0.030 // +0.87%

Prices are testing below support at 3.447, the 14.6%Fibonacci retracement. A break downward targets the March 19 swing low at 3.388. Near-term resistance is at 3.483, the 23.6% level, with a reversal above that aiming for 38.2% Fib at 3.542.

Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com

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Crude Oil to Rise as Gold Falls on Orderly Cyprus Banks Reopen

Crude oil is likely to rise amid a recovery in risk appetite while gold prices fall if Cyprus manages an orderly reopening of the troubled nation’s banks.

Talking Points

Crude Oil, Copper Look to Reopening of Cyprus Banks to Guide Risk Trends Gold Prices to Decline as Silver Moves Higher on Recovery in Risk Sentiment Commodity prices are treading water in late Asian trade as markets continue to cast a worried eye toward the Eurozone. Needless to say, lingering uncertainty in Cyprus and political instability in Italy remain in focus. Greek newspaper Kathimerini reported that Cypriot banks will finally reopen today and traders will be closely watching to gauge the effectiveness of capital controls installed to prevent a mass exodus of capital.

A relatively orderly reopening may boost risk appetite, sending cycle-sensitive crude oil and copper prices higher. The XAU/XAG ratio is showing an increasingly significant inverse correlation with our in-house risk appetite gauge, hinting such an outcome stands to weigh on gold while boosting silver. Signs of social unrest or reports of banks flouting the new rules stand to yield the opposite results.

Meanwhile in Italy, Democratic Party Leader Pier Luigi Bersani is expected to report that he was not able to forge a coalition today, clearing the way for President Napolitano to tap a neutral politician to attempt to form a government that brings together the various Italian political factions. Investors will be keen to learn who this may be and gauge whether he/she has the wherewithal to succeed in producing a pro-reform administration.

S&P 500 index futures are pointing lower, warning that the path of least resistance for risk appetite favors the downside. On the economic data front, the spotlight is on the final revision of fourth-quarter US GDP figures. Weekly Jobless Claims data as well as the Chicago PMI and Kansas City Fed Manufacturing Activity leading indicators are likewise on tap.

WTI Crude Oil (NY Close): $96.58 // +0.24 // +0.25%

Prices broke resistance at 96.41, the 50% Fibonacci expansion, a barrier reinforced by a falling trend line set from late January. Buyers now target the 61.8% Fib at 98.09. The 96.41 level has been recast as near-term support, with a turn back beneath that exposing the 38.2% Fib at 94.74.

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Gold (NY Close): $1605.25 // +5.21 // +0.33%

Prices are testing support at 1597.77, the 14.6% Fibonacci expansion, a barrier reinforced by a rising trend line set from late February (1596.09). A break below that exposes the 23.6% level at 1586.27. Near-term resistance is at 1616.98, the March 21 high, with a reversal above that aiming for a longer-term falling trend line at 1638.85.

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Silver (NY Close): $28.69 // -0.08 // -0.27%

Prices continue to consolidate above support at 28.46, the 23.6% Fibonacci expansion. A break below that exposes the 38.2% level at 27.86.Near-term resistance is in the 29.42-92 area, with a break higher targeting a falling trend line now at 30.06.

Daily Chart - Created Using FXCM Marketscope 2.0

COMEX E-Mini Copper (NY Close): $3.444 // +0.002 // +0.06%

Prices are testing below support at 3.447, the 14.6% Fibonacci retracement. A break downward targets the March 19 swing low at 3.388. Near-term resistance is at 3.483, the 23.6% level, with a reversal above that aiming for 38.2% Fib at 3.542.

Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com

To contact Ilya, e-mail ispivak@dailyfx.com. Follow Ilya on Twitter at @IlyaSpivak

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Crude Oil, Gold May Struggle to Further Post-Cyprus Deal Trends

Crude oil is on the upswing while gold is under pressure in the wake an agreement on a bailout for Cyprus but the trends now on display may prove short-lived.

Talking Points

Crude Oil is on the Rise as Cyprus Bailout Deal Stokes Risk Appetite Gold and Silver Turn Lower on Diminished Market Dislocation Fears Crude oil is pushing higher along with Asian and European stock exchanges as risk appetite firms after Cyprus and the so-called “troika” (EU/ECB/IMF) agreed to measures paving the way for launch of the country’s bailout program. Gold and silver are trading lower as the apparent reduction in tail risk stemming from the agreement dents demand for alternative store-of-value assets. A lackluster response from the Euro hints not all is well however, warning that the optimism in the shares and commodities spaces may not prove lasting.

Forex traders’ lack of enthusiasm seems reasonable. The critical issue in for markets in following the Cyprus situation remains that of precedent for larger Eurozone countries, and the way in which the crisis has been managed does not seem to inspire a great deal of confidence. At best, depositors in Cypriot banking institutions now have to contend with capital controls locking up their money. At worst, they may lose as much as 40 percent of it.

This raises an important question: why should a depositor in any Eurozone country similarly vulnerable to a banking crisis expect to be unscathed if a Cyprus-like calamity were to occur there? If this expectation seems unreasonable in light of today’s events, said depositor (and many others) may well opt not to keep money in the Eurozone. This leaves markets waiting to see if a mass exodus of capital does indeed occur, for then the worst-case scenario will be upon the Eurozone whether or not Cyprus receives its aid.

WTI Crude Oil (NY Close): $93.71 // +1.26 // +1.36%

Prices are testing resistance at 94.07, the March 19 swing high, with a break higher on a daily closing basis targeting 95.51. A break above that targets trend line resistance at 96.33. Near-term support is at 91.97, the 23.6% Fibonacci expansion.

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Gold (NY Close): $1608.58 // -6.30 // -0.39%

Prices are approaching support at 1597.76, the 14.6% Fibonacci expansion, with a break lower exposing the 23.6% level at 1586.30. Near-term resistance is at 1616.98, the March 21 high. A move above that aims for a longer-term falling trend line at 1642.66.

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Silver (NY Close): $28.74 // -0.44 // -1.49%

Prices continue to consolidate above support at 28.46, the 23.6% Fibonacci expansion. Near-term resistance is in the 29.42-92 area, with a break higher exposing a falling trend line now at 30.24. Alternatively, a reversal below support targets the 38.2% level at 27.86.

Daily Chart - Created Using FXCM Marketscope 2.0

COMEX E-Mini Copper (NY Close): $3.466 // +0.030 // +0.87%

Prices are testing above resistance at 3.483, the 23.6% Fibonacci retracement. A break higher exposes the 38.2% level at 3.542. Near-term support is at 3.447, the 14.6% Fib, with move beneath that aiming for the March 19 swing low at 3.388.

Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com

To contact Ilya, e-mail ispivak@dailyfx.com. Follow Ilya on Twitter at @IlyaSpivak

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Crude Reaches Trendline Resistance

Weekly Bars

Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0

Are you new to FX or curious about your trading IQ?

Commodity Analysis: “Crude is well supported on dips and near term focus remains higher towards former support at 94.94. Bigger picture, last week’s reversal, recent trendline resistance break and trendline support hold paint a bullish picture.” Crude blew through 94.94 and is now approaching the line that extends off of the September and January highs. A break above that line could open up a move towards 105. Barring a break however, favor the range.

Commodity Trading Strategy: Need to see the market respond to the current level before doing anything. A drop below 96.25 and weak recovery would favor a short.

LEVELS: 93.30 94.06 95.21 97.21 98.21 100.40

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Crude Oil, Gold May Struggle to Further Post-Cyprus Deal Trends

Crude oil is on the upswing while gold is under pressure in the wake an agreement on a bailout for Cyprus but the trends now on display may prove short-lived.

Talking Points

Crude Oil is on the Rise as Cyprus Bailout Deal Stokes Risk Appetite Gold and Silver Turn Lower on Diminished Market Dislocation Fears Crude oil is pushing higher along with Asian and European stock exchanges as risk appetite firms after Cyprus and the so-called “troika” (EU/ECB/IMF) agreed to measures paving the way for launch of the country’s bailout program. Gold and silver are trading lower as the apparent reduction in tail risk stemming from the agreement dents demand for alternative store-of-value assets. A lackluster response from the Euro hints not all is well however, warning that the optimism in the shares and commodities spaces may not prove lasting.

Forex traders’ lack of enthusiasm seems reasonable. The critical issue in for markets in following the Cyprus situation remains that of precedent for larger Eurozone countries, and the way in which the crisis has been managed does not seem to inspire a great deal of confidence. At best, depositors in Cypriot banking institutions now have to contend with capital controls locking up their money. At worst, they may lose as much as 40 percent of it.

This raises an important question: why should a depositor in any Eurozone country similarly vulnerable to a banking crisis expect to be unscathed if a Cyprus-like calamity were to occur there? If this expectation seems unreasonable in light of today’s events, said depositor (and many others) may well opt not to keep money in the Eurozone. This leaves markets waiting to see if a mass exodus of capital does indeed occur, for then the worst-case scenario will be upon the Eurozone whether or not Cyprus receives its aid.

WTI Crude Oil (NY Close): $93.71 // +1.26 // +1.36%

Prices are testing resistance at 94.07, the March 19 swing high, with a break higher on a daily closing basis targeting 95.51. A break above that targets trend line resistance at 96.33. Near-term support is at 91.97, the 23.6% Fibonacci expansion.

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Gold (NY Close): $1608.58 // -6.30 // -0.39%

Prices are approaching support at 1597.76, the 14.6% Fibonacci expansion, with a break lower exposing the 23.6% level at 1586.30. Near-term resistance is at 1616.98, the March 21 high. A move above that aims for a longer-term falling trend line at 1642.66.

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Silver (NY Close): $28.74 // -0.44 // -1.49%

Prices continue to consolidate above support at 28.46, the 23.6% Fibonacci expansion. Near-term resistance is in the 29.42-92 area, with a break higher exposing a falling trend line now at 30.24. Alternatively, a reversal below support targets the 38.2% level at 27.86.

Daily Chart - Created Using FXCM Marketscope 2.0

COMEX E-Mini Copper (NY Close): $3.466 // +0.030 // +0.87%

Prices are testing above resistance at 3.483, the 23.6% Fibonacci retracement. A break higher exposes the 38.2% level at 3.542. Near-term support is at 3.447, the 14.6% Fib, with move beneath that aiming for the March 19 swing low at 3.388.

Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com

To contact Ilya, e-mail ispivak@dailyfx.com. Follow Ilya on Twitter at @IlyaSpivak

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Crude Oil Weekly Technical Outlook

Crude oil stayed in range below 98.24 last week. With daily MACD staying below signal line, 98.24 should be a short term top and deeper decline is in favor. Below 94.97 will confirm this case and should bring deeper pull back to 55 days EMA (now at 92.47) and below. On the upside, break of 98.24 is needed to confirm rally resumption. Otherwise, near term outlook is neutral at best.

In the bigger picture, price actions from 114.83 are viewed as a triangle consolidation pattern, no change in this view. And, such consolidation could still be in progress and Crude oil remains bounded in the converging range. Nonetheless, the pattern should be close to completion and an upside breakout should be seen soon. Above 100.42 will strongly suggest that whole rebound from 33.29 has resumed for above 114.83. And in case of another fall, strong support should be seen above 77.28 to bring rebound.

In the long term picture, crude oil is in a long term consolidation pattern from 147.27, with first wave completed at 33.2. The corrective structure of the rise from 33.2 indicates that it's second wave of the consolidation pattern. While it could make another high above 114.83, we'd anticipate strong resistance ahead of 147.24 to bring reversal for the third leg of the consolidation pattern.

Nymex Crude Oil Continuous Contract 4 Hours Chart

Nymex Crude Oil Continuous Contract Daily Chart

Nymex Crude Oil Continuous Contract Weekly Chart

Nymex Crude Oil Continuous Contract Monthly Chart

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Weekly Fundamentals - Brent Crude Extended Decline on Easing Iranian Tensions

ONG Focus | Insights | Written by Oil N' Gold | Sat Mar 02 13 04:19 ET

Early last week, the market attention was mainly on the hung parliament formed after the Italy election. Sentiment was also damped by Moody’s downgrade of UK’s triple A credit rating. Later in the week, investors’ risk appetite improved after Italy’s bond auctions and ECB President Draghi’s Assurance that the central bank would not exit monetary easing soon. Another focus was the US sequester, i.e. about $85 billion in spending cuts, that began on March 1. Negotiation on Friday between Obama and congressional leaders failed to reach an agreement to avoid the reductions.

Crude Oil: Brent crude plunged last week with the front-month contract reverting back to the 110 level as geopolitical tensions eased for the time being. The P5+1 negotiation about Iran’s nuclear development was held last week in Almaty. While the meeting, the first time since last June in Moscow, has not made any deal yet, it is deemed to be a more constructive one as all parties agreed to hold a new round of talks in Turkey on March 17-18 March and then more high-level talks in Kazakhstan on April 5-6. Moreover at the meeting, the Western allies agreed to offer Iran limited sanctions relief if it stops its output of 20% enriched uranium. Iran stated that it would consider the offer. Yet, Tehran’s Interim Friday Prayers Leader Hojjatoleslam Kazem Seddiqi stressed that “any proposal which denies the people their rights is dismissed by the nation and no official has the right to compromise in this regard”.

Natural Gas: The DOE/EIA reported a -171 drop of gas storage to 2 229 bcf in the week ended February 22. Stocks were -307 bcf less than the same period last year and -308 bcf above the 5-year average of 1 921 bcf. Separately, Baker Hughes reported that the number of gas rigs fell -8 units to 420 in the week ended March 1. Oil rigs increased +4 units to 1 333 and miscellaneous rigs remained unchanged and the total number of rigs fell -4 units to 1 757. Directionally oriented combined oil, gas, and miscellaneous rigs slipped -12 units to 185 units while horizontal rigs added +1 unit to 1 141 units and vertical rigs added +7 units to 431 during the week.

Precious Metals: Despite a modest rebound earlier in the week, selloff resumed with the benchmark Comex gold contract losing -0.03% on weekly basis. In the complex, the decline in PGMs prices was more severe with platinum and palladium losing -2.11% and -2.03% respectively. South African government has proposed measures to allow more institutions to provide exposure to commodity ETFs, in particular gold and platinum.

 

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Gold Weekly Technical Outlook (Saturday, 16 March 2013 10:05 ET)Silver Weekly Technical Outlook (Saturday, 16 March 2013 10:05 ET)Crude Oil Weekly Technical Outlook (Saturday, 16 March 2013 10:05 ET)Natural Gas Weekly Technical Outlook (Saturday, 16 March 2013 10:04 ET)Weekly Fundamentals - WTI- Brent Spread Narrowed o... (Saturday, 16 March 2013 02:38 ET)Strong US Data Sent Shares to New Highs (Friday, 15 March 2013 01:03 ET)Economic Calendar 3/15/13 (Thursday, 14 March 2013 22:13 ET)IEA Lowered Global Oil Demand Growth Forecast for ... (Thursday, 14 March 2013 08:50 ET)Crude Weakened on Inventory Increase (Wednesday, 13 March 2013 23:14 ET)Economic Calendar 3/14/13 (Wednesday, 13 March 2013 23:12 ET)

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Crude Oil Weekly Technical Outlook

Crude oil stayed in range below 98.24 last week. With daily MACD staying below signal line, 98.24 should be a short term top and deeper decline is in favor. Below 94.97 will confirm this case and should bring deeper pull back to 55 days EMA (now at 92.47) and below. On the upside, break of 98.24 is needed to confirm rally resumption. Otherwise, near term outlook is neutral at best.

In the bigger picture, price actions from 114.83 are viewed as a triangle consolidation pattern, no change in this view. And, such consolidation could still be in progress and Crude oil remains bounded in the converging range. Nonetheless, the pattern should be close to completion and an upside breakout should be seen soon. Above 100.42 will strongly suggest that whole rebound from 33.29 has resumed for above 114.83. And in case of another fall, strong support should be seen above 77.28 to bring rebound.

In the long term picture, crude oil is in a long term consolidation pattern from 147.27, with first wave completed at 33.2. The corrective structure of the rise from 33.2 indicates that it's second wave of the consolidation pattern. While it could make another high above 114.83, we'd anticipate strong resistance ahead of 147.24 to bring reversal for the third leg of the consolidation pattern.

Nymex Crude Oil Continuous Contract 4 Hours Chart

Nymex Crude Oil Continuous Contract Daily Chart

Nymex Crude Oil Continuous Contract Weekly Chart

Nymex Crude Oil Continuous Contract Monthly Chart

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Crude Inventory Increased Less Than Expected

ONG Focus | Insights | Written by Oil N' Gold | Wed Feb 27 13 12:02 ET

The DOE/EIA reported that total crude oil and petroleum products stocks declined -5.90 mmb to 1088.80 mmb in the week ended February 22. Crude stockpile increased +1.13 mmb to 377.52 mmb as inventory soared in 3 out of 5 PADDs. Cushing stock fell -0.08 mmb to 50.58 mmb. Utilization rate was up +2.20% to 85.1%.

Gasoline inventory dipped -1.86 mmb to 228.50 mmb as demand climbed +1.90% to 8.60M bpd. Production added +3.08% to 9.21M bpd while imports climbed +13.86% to 0.58M bpd. Distillate inventory added +0.56 mmb to 124.18 mmb as demand fell 8.04% to 3.50M bpd. Imports dipped -46.94 to 0.16M bpd while production added 4.96% to 4.48M bpd during the week.

 

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Gold Weekly Technical Outlook (Saturday, 16 March 2013 10:05 ET)Silver Weekly Technical Outlook (Saturday, 16 March 2013 10:05 ET)Crude Oil Weekly Technical Outlook (Saturday, 16 March 2013 10:05 ET)Natural Gas Weekly Technical Outlook (Saturday, 16 March 2013 10:04 ET)Weekly Fundamentals - WTI- Brent Spread Narrowed o... (Saturday, 16 March 2013 02:38 ET)Strong US Data Sent Shares to New Highs (Friday, 15 March 2013 01:03 ET)Economic Calendar 3/15/13 (Thursday, 14 March 2013 22:13 ET)IEA Lowered Global Oil Demand Growth Forecast for ... (Thursday, 14 March 2013 08:50 ET)Crude Weakened on Inventory Increase (Wednesday, 13 March 2013 23:14 ET)Economic Calendar 3/14/13 (Wednesday, 13 March 2013 23:12 ET)

View the original article here

Crude Oil Weekly Technical Outlook

Crude oil stayed in range below 98.24 last week. With daily MACD staying below signal line, 98.24 should be a short term top and deeper decline is in favor. Below 94.97 will confirm this case and should bring deeper pull back to 55 days EMA (now at 92.47) and below. On the upside, break of 98.24 is needed to confirm rally resumption. Otherwise, near term outlook is neutral at best.

In the bigger picture, price actions from 114.83 are viewed as a triangle consolidation pattern, no change in this view. And, such consolidation could still be in progress and Crude oil remains bounded in the converging range. Nonetheless, the pattern should be close to completion and an upside breakout should be seen soon. Above 100.42 will strongly suggest that whole rebound from 33.29 has resumed for above 114.83. And in case of another fall, strong support should be seen above 77.28 to bring rebound.

In the long term picture, crude oil is in a long term consolidation pattern from 147.27, with first wave completed at 33.2. The corrective structure of the rise from 33.2 indicates that it's second wave of the consolidation pattern. While it could make another high above 114.83, we'd anticipate strong resistance ahead of 147.24 to bring reversal for the third leg of the consolidation pattern.

Nymex Crude Oil Continuous Contract 4 Hours Chart

Nymex Crude Oil Continuous Contract Daily Chart

Nymex Crude Oil Continuous Contract Weekly Chart

Nymex Crude Oil Continuous Contract Monthly Chart

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Crude Oil Weekly Technical Outlook

Crude oil edged lower to 89.33 and breached 90 psychological level briefly before recovering. Some sideway trading would be seen in near term. But outlook stays mildly bearish as long as 93.37 minor resistance holds. Current decline from 98.24 is still expected to continue. Break of 89.33 will target next support level at 84.05.

In the bigger picture, price actions from 114.83 are viewed as a triangle consolidation pattern, no change in this view. And, such consolidation could still be in progress and Crude oil remains bounded in the converging range. Nonetheless, the pattern should be close to completion and an upside breakout should be seen soon. Above 100.42 will strongly suggest that whole rebound from 33.29 has resumed for above 114.83. And in case of another fall, strong support should be seen above 77.28 to bring rebound.

In the long term picture, crude oil is in a long term consolidation pattern from 147.27, with first wave completed at 33.2. The corrective structure of the rise from 33.2 indicates that it's second wave of the consolidation pattern. While it could make another high above 114.83, we'd anticipate strong resistance ahead of 147.24 to bring reversal for the third leg of the consolidation pattern.

Nymex Crude Oil Continuous Contract 4 Hours Chart

Nymex Crude Oil Continuous Contract Daily Chart

Nymex Crude Oil Continuous Contract Weekly Chart

Nymex Crude Oil Continuous Contract Monthly Chart

View the original article here

Crude Oil Weekly Technical Outlook

Crude oil edged lower to 89.33 and breached 90 psychological level briefly before recovering. Some sideway trading would be seen in near term. But outlook stays mildly bearish as long as 93.37 minor resistance holds. Current decline from 98.24 is still expected to continue. Break of 89.33 will target next support level at 84.05.

In the bigger picture, price actions from 114.83 are viewed as a triangle consolidation pattern, no change in this view. And, such consolidation could still be in progress and Crude oil remains bounded in the converging range. Nonetheless, the pattern should be close to completion and an upside breakout should be seen soon. Above 100.42 will strongly suggest that whole rebound from 33.29 has resumed for above 114.83. And in case of another fall, strong support should be seen above 77.28 to bring rebound.

In the long term picture, crude oil is in a long term consolidation pattern from 147.27, with first wave completed at 33.2. The corrective structure of the rise from 33.2 indicates that it's second wave of the consolidation pattern. While it could make another high above 114.83, we'd anticipate strong resistance ahead of 147.24 to bring reversal for the third leg of the consolidation pattern.

Nymex Crude Oil Continuous Contract 4 Hours Chart

Nymex Crude Oil Continuous Contract Daily Chart

Nymex Crude Oil Continuous Contract Weekly Chart

Nymex Crude Oil Continuous Contract Monthly Chart

View the original article here

Crude Weakened on Inventory Increase

ONG Focus | Insights | Written by Oil N' Gold | Wed Mar 13 13 23:14 ET

Wall Street made record highs again as driven by stronger-than-expected US retail sales. Earnings results from Costco also beat expectations. Gains in shares were, however, limited by disappointing Eurozone IP and US President Obama signaled unsuccessful deal to end sequester. DJIA climbed +0.04% to end the day at 14455.28 while the S&P 500 index added +0.13% to 1554.52. In the commodity sector, oil prices plunged with the front-month WTI crude contract slipped to as low as 91.91 before ending the day largely unchanged at 92.52. The Brent crude contract plummeted for a 4th consecutive day to 107.91, the lowest level in 3 weeks, before settling at 108.52, down -1.03%. In the commodity sector, gold slipped after failing to re-test 1600.

The market was boosted by Costco Wholesale Corp.'s quarterly result in which net income gained around +38% to US$547M, driven by a tax benefit on a dividend paid to an employee retirement program. Meanwhile, US retail sales climbed +1.1% m/m in February after adding +0.1% a month ago. The strong-than-expected result indicated that consumers have not been adversely affected by tax hikes and high gasoline prices. Excluding autos, retail sales rose +1.0% m/m in February, following a +0.2% gained in January. However, market sentiment was, however, contained by Eurozone's industrial production which fell -0.4% m/m in January, compared with a upwardly revised +0.9% gain in December. On annual basis, IP fell -1.3% after a revised -1.7% drop in December.

On oil inventory, the DOE/EIA reported that total crude oil and petroleum products stocks declined -5.58 mmb to 1080.79 mmb in the week ended March 8. Crude stockpile increased +2.62 mmb to 388.96 mmb as inventory soared in 3 out of 5 PADDs. Cushing stock added -1.53 mmb to 49.32mmb. Utilization rate was down -1.20% to 81.0%.

Gasoline inventory dipped -3.57 mmb to 224.31 mmb although demand rose +3.14% to 8.63M bpd. Production added +4.04% to 8.95M bpd while imports climbed +20.17% to 0.73M bpd. Distillate inventory added +0.08 mmb to 120.44 mmb although demand plunged -13.2% to 3.35M bpd. Imports soared +126.79% to 0.25M bpd while production fell -2.16% to 4.16M bpd during the week.

The RBNZ is expected to leave the OCR unchanged at 2.5%. The pause would likely continue until next year. The SNB would also leave the 3-month LIBOR rate at 0-0.25% and policymakers would also pledge to maintain the EURCHF floor at 1.20.

 

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