Futures end mix as FED disappoints, Irene lurks

Posted by Mark Pszeniczny on Aug 26, 2011 3:53:00 PM

On Wednesday we suggested that todays market could be volatile as many investors were eagerly anticipating the FED chairman speech.  The consensus was that new measures would be put in place to spur growth.  It became clear early in the session that this was not going to happen and all pits sold off quickly and RBOB dropped as much as five cents.  Not to be outdone Crude was down over $2 as well.   However, as GDP numbers were released, the pits clawed their way back into positive ground.  GDP grew by only 1% for the second quarter, less than the expected 1.3%,  As the day wore on, pricing did not move all that much as it appeared many may have gotten out of Dodge ahead of Irene.  Currently it appears that the storm will hit the Northeast sometime Sunday as a hurricane and move rapidly through the Northeast over the course of the day, of course making a stop in Wilbraham, Ma.  With high winds and heavy flooding, power outages are expected.  Fear not folks, DKB world headquarters will be staffed and ready to assist.  At the close, Crude added.07 to $85.37, HEAT gained .0246 to $3.0101 and RBOB fell .0333 to $2.9346, while OCT RBOB only lost .0157.  Stay safe.

Heat map

RBOB CLOSE
                 CLOSE       CHANGE 
  
SEP    29346       -.0333
OCT    27860     -.0157
NOV    27358     -.0071
DEC   27141       -.0019
JAN    27120       -.0012
FEB    27191      -.0004
HEAT CLOSE
          CLOSE    CHANGE
SEP    30101    +.0246
OCT   30158     +.0226
NOV    30211      +.0220
DEC   30264     +.0216
JAN   30319      +.0205
FEB   30262      +.0189
Read More

Topics: Hurricane Irene, Bernanke

NYMEX rebounds with Bullish Inventories

Posted by Mark Pszeniczny on Aug 10, 2011 5:39:00 PM

We continue the "new normal" roller coaster ride as NYMEX values once again turn sharply positive on the the heels of a very bullish Inventory report.  Not helping the cause was the FED announcing yesterday that they will hold rates very low for the next two years.  It was the first such comment that actually put a timeline on Interest rates.  Furthermore, the comments are a complete 180 degree turn in approach from the usually vague board.  With the greenback being pushed lower, Commodities surged higher beginning just after yesterdays close.  DOE numbers showed a staggering 5.2mbl draw in Crude, while most expected a 1.7mbl build.  Gas fell 1.6mbl vs a 700k expected build and distillates drew 737k while analysts expected a build of 1.25mbls.  All this while the DOW continues its own seesaw as our 401k's become 201e's!  Currently down over 300 points, the EIA just recently reported that it sees "significant downside risk" should current financial market concerns become more widespread.  Either way, we are above that magical $2.80 number again on HEAT as it closed up .1005 to $2.8653, RBOB gained .1149 to $2.7825 and CRUDE added $3.59 to $82.89. 
 
heat chart
RBOB CLOSE
                 CLOSE       CHANGE 
  
SEP    27825       +.1149
OCT    26312      +.1104
NOV    26022      +.1074
DEC   25902       +.1046
JAN    25946       +.1043
FEB    26076      +.1038
 
HEAT CLOSE
          CLOSE    CHANGE
SEP    28653     +.1005
OCT   28751      +.0988
NOV    28863      +.0960
DEC   28970     +.0933
JAN   29083       +.0909
FEB   29079       +.0886
Read More

Topics: Commodities, EIA, Bernanke, Dollar falls, S&P Downgrade, Inventory Draws, Crude draws

NYMEX futures end mixed as concerns loom

Posted by Mark Pszeniczny on Apr 28, 2011 8:23:00 PM

What is funny about Todays title is that it seems that I have used it several times over the last month!  Another Groundhog Day with the Market up strong on the overnight, falling into negative ground late in the day and ending as a mixed bag at the close.  Investors were eager to jump in overnight as many weighed the FED Chairman's comments and the reluctance to raise interest rates.  The decision to keep rates extremely low signals to investors that the US economy still has some hurdles to jump before we are all fat and happy again.  That policy is weighing heavy on the greenback, pushing it to a 33 month low.  We all know the corollary is the high Crude and product prices as inflationary hedges from investors.  The news the economy only grew 1.8% last quarter while most were expecting a 3.1% increase did little to ease rising NYMEX prices.  Yet around mid session a sell off materialized that had both products negative for some time.  HEAT was able finish in the red as it fell a mere 18pts to $3.2316, RBOB keeps pushing higher as it gained .0104 to $3.4298, while CRUDE gained .10 to $112.86.  With $28 crack spreads on gas, it is not hard to see how Exxon posted 69% Q1 profits.   While it is easy to point to middle eastern unrest as the cause of this surge, it is tough to defend as supplies in the US are still at very healthy levels.  End result is that this bubble has to burst.  Hopefully soon. 

 

heat chart

 

RBOB CLOSE
                      CLOSE       CHANGE
 MAY    34298       +.0104
   JUN    33696       +.0114
     JUL    33230        +.0117
  AUG    32831       +.0100
  SEP     32443       +.0075
  OCT    30856        +.0062
HEAT CLOSE
          CLOSE    CHANGE
MAY    32316       -.0018
JUN    32459      -.0022
JUL    32619      -.0027
AUG    32785        -.0031
SEP    32951       -.0036
OCT    33103        -.0043
Read More

Topics: FED holds interest rates, Bernanke, Dollar falls

Sell off fails to materialize, prices dip

Posted by Mark Pszeniczny on Dec 6, 2010 9:54:00 PM

While I was watching FED Chairman on 60 minutes last night it occurred to me very early in the interview: Bernanke was very, very nervous.  Something I have never seen before, even in the midst of the crisis.  Furthermore, comments made about how our Nation’s economy was still “struggling to sustain itself”  appeared to rattle overnight investors.  Early session buyers flooded the market.  Yet in typical fashion, HEAT pits were unable to cross the $2.50 level which has held as the yearly high.  Keeping some pressure on HEAT was also the regions first shot of cold and wintery weather.  Both Maine and Southern Connecticut got hit along with areas in Eastern NY.  You won’t find many in our industry cursing the weather as it has been long over due.  Still many are keeping watchful eyes on their thermostats and purse strings as the recent Jobs report solidified a somewhat HO-HUM near term picture that our economy is not out of the woods yet.  $3 retail gasoline is not helping anyone out to boot!  At the close, Crude edge slightly higher to $89.38 gaining .19, RBOB lost .0104 to $2.3417 and HEAT fell .0117 to $2.4757.

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Topics: Bernanke, Jobless numbers, HEAT, RBOB

NYMEX waivers ahead of Inventories

Posted by Mark Pszeniczny on Jun 8, 2010 9:34:00 PM

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

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