June, 2010 | Dennis K. Burke, Inc. Market Updates

Storm fear fades, prompting sell off: Crude tumbles

Posted by Mark Pszeniczny on Tue, Jun 29, 2010 @ 08:40 PM

As quick as we saw the jump on Friday, we had thought that it was storm fear buying. And today brought vindication of those thoughts as I woke to a market down over 5 cents in both pits. As the opening bell rang, the buyers could not contain themselves prompting prices to claw back a few cents only to be weighed down by overriding fundamentals. The first named storm of the season is projected to miss most of the producing region in the Gulf and make landfall off US soil south of the tip of Texas. Product remains plentiful, even with expected draws in both Crude and gasolines this week while distillates are expected to show mild increases. As Wednesday’s expiry approaches, technical selling and booking profits for the quarter might push values down even further. At the close, Crude tumbled $2.31 to $75.94, RBOB lost .0656 to $2.0720 and JUL HEAT lost .0720 to $2.0213. The range appears to be widening some, but most are still unwilling to commit one way or the other.

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Tags: The Market, CRUDE falls, Expected Draws in Crude and Gas

Seesaw action ends with mixed day, blame Chinese currency fluctuation

Posted by Mark Pszeniczny on Sun, Jun 20, 2010 @ 08:35 PM

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Late Sunday night I was surprised to see values up over 2 cents because after Friday’s movement I would have expected some sharp drops. That is until I saw China announced that their currency would be allowed to fluctuate against other currencies. This would/should weaken the dollar to Chinese investors thereby making Crude and its products more affordable. Thus Crude now becomes a safe haven against a falling dollar for other investors, pushing values higher. Additionally, all goods become cheaper to China spurring US manufacturing rates and another economic boom is on the horizon! That was 7pm last night, as of 3pm today, eh … not so much. Profit taking ensued pealing values all the way back to zero and RBOB actually finished negative on the day, down .0048 to $2.1428, HEAT stayed positive closing at +.0170 to $2.1459. CRUDE mustered up enough strength to close up .64 to $77.82. I wish I can say this is the last of the recent rally, but that can only be determined after a few mixed sessions like we saw today. With month end and quarter end quickly approaching, expect some more downside as the big guys looks to book profits.

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Tags: NYMEX, The Market, Chinese Currency, Dollar falls, Profit taking

NYMEX waivers ahead of Inventories

Posted by Mark Pszeniczny on Tue, Jun 08, 2010 @ 08:34 PM

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We had anticipated some sideways action over the next few sessions as traders decide which bandwagon to jump on. Nothing was more evident than today that saw thin news have short, sharp impacts on the trade. After a moderately low start, both products were down over a penny, news of a Natural gas pipeline explosion boosted values until mid morning as FED chairman Bernanke spoke on how the economic recovery is ongoing, we probably wont “feel” it for sometime. As what has been the theme for going on several weeks, the uncertainty around the health of the economy will slosh around the trade until we have defining technical or fundamental reasons to move in either direction. Looking out further, with the Chinese government intentionally slowing their economy to curb massive inflation concerns, it may have longer consequences on the US. With estimates of inventories being mixed, don’t expect any clearer view of direction in Wednesday’s session. At the close, Crude added .55 to $71.99, RBOB fell .0058 to $1.9891 and HEAT managed to edge out a loss of .0030 to $1.9653.

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Tags: NYMEX, The Market, Bernanke, Chinese Currency, Natural Gas Pipeline Explosion

Weak Jobs push Markets south, destroy extended rally

Posted by Mark Pszeniczny on Fri, Jun 04, 2010 @ 08:24 PM

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The sideways action continues as a healthy correction has once again seen buyers run for the hills. On the heels of healthy construction spending and new home sales, and some bullish inventory numbers, the Jobs data that was released today wiped away any chance of an extended rally. Most were expecting healthy increases in jobs but once the census workers were removed from the data, jobs actually were flat, setting off a firestorm of selling in all markets. The Dow was down over 300pts and the Euro continues to get hammered against the greenback. Short term, the prompt HEAT contract in the $1.85 to $1.95 range looks still to be defining the 5 to 7 o’clock hour on the clock. Anywhere in this range appears to bring out the buyers. Longer out is going to heavily depend on demand and when OPEC feels the need to jump in. At the Close, HEAT fell .0814 to $1.9577, RBOB lost .0859 to $1.9953 and Crude lost $3.10 to $71.51. The prevention of the magical third up day has most assuming the sideways action or range bound trading will continue.

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Tags: The Market, OPEC, HEAT, Weak Jobs Report

Futures show solid gains on home sales

Posted by Mark Pszeniczny on Wed, Jun 02, 2010 @ 08:12 PM

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It was one of those days in the pits as the market opened positive and stayed there all day. After yesterday’s impressive construction spending report and today’s strong Home sales news, buyers appeared willing to jump back into Commodities. Many point out that we still look to be oversupplied, but by how much, should be defined as the inventory report gets released on Thursday. As we see so often, and shown by the chart below, a good deal of buying occurs after a floor appears to be defined. Hindsight being perfect of course. One should note how little we have heard from OPEC over the last few weeks during the correction. This is also typically about the time when news outlets will pick up stories on gas prices. Remember the street pricing being several days behind what the NYMEX does. All in all, the taking back of yesterdays losses today was somewhat expected as the sideways action should continue prior to the first named storm of the season. At the close, Crude gained a mere .28 to $72.86 yet RBOB jumped .0436 to $2.0261 and HEAT added .0355 to $2.0059.

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Tags: NYMEX, The Market, OPEC, Commodities

NYMEX bounces, end negative

Posted by Mark Pszeniczny on Tue, Jun 01, 2010 @ 08:10 PM

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Almost on cue, the NYMEX sold off overnight as length added on Thursday was peeled away as what typically happens ahead of a long weekend. But, a surprise was in store as reports of May construction spending hit the wires and showed the largest monthly increase in years of 2.7%. Again, we weren’t starting from a very high number. The range bound action looks to continue for the short week as Inventory numbers will be delayed a day. What is surprising is with “Top Kill” of the leaking well officially dead, we haven’t seen a dramatic jump in prices. A few years ago, Crude would be $100 a barrel on such an event. The sensibility in the markets, fear of a still weak world economy and the overall bearish tone have kept the spill all but in check. As we mentioned last week, the Far East appears to be next in line for some economic Darwinism as weekend violence in Spain and Portugal spread due to those Governments actions to combat the worsening economy. Look for the see saw trade to continue as be ready for buying opportunities as some good values are still out there. All products fell hard into the close with Crude losing $1.39 to $72.58, HEAT lost .0341 to $1.9704 and RBOB fell .0441 to $1.9825

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Tags: NYMEX, The Market, Construction Spending Up

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Energy Market Updates

Storm fear fades, prompting sell off: Crude tumbles

Seesaw action ends with mixed day, blame Chinese currency fluctuation

NYMEX waivers ahead of Inventories

Weak Jobs push Markets south, destroy extended rally

Futures show solid gains on home sales

NYMEX bounces, end negative