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Crude Drops Anchor While Natural Gas Positive

ByCommodityOnline
Published 05/24/2012, 05:18 AM
Updated 05/14/2017, 06:45 AM
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Crude trading range for the day is 5014-5190. Technically market is trading in the range as RSI for 18 days is currently indicating 31.88, where as 50 DMA is at 5365 and crude is trading below the same and getting support at 5051 and below could see a test of 5014 level, and resistance is now likely to be seen at 5139, a move above could see prices testing 5190.

Crude oil dropped below 5100 level after US government report on oil supplies, while traders awaited the outcome of a EU summit. Energy prices came under further pressure after chief of the UN nuclear agency said that he reached a deal with Iran on probing suspected work on nuclear weapons, increasing the prospect of a resolution to a conflict over the issue.

Natural gas trading range for the day is 143.8-159.8. Market is looking to take support at 148.8, a break below could see a test of 143.8 and resistance is now likely to be seen at 156.8, a move above could see prices testing 159.8.

Natural gas yesterday traded with the positive node and settled 2.28% up at 153.80 but before that market had opened at 150.60 and dropped to the day's low at 146.80 as traders were wary of pushing prices higher ahead of the US government report on natural gas supplies.

A major breather on the supply front came in as hopes of a deal between Iran and the International Atomic Energy eased supply worries. On the Nymex, the crude oil July contract slipped around 2 percent and settled at $89.90/bbl.

With fundamentals becoming weak amid a negative macroeconomic scenario, expection of the downtrend in crude oil prices to continue today. Additionally, latest data on the Chinese manufacturing front is also bearish and will add to further downside.

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