Renewed Global Concerns Reverse Tuesday's Futures Sell Off

Posted by Mark Pszeniczny on Nov 13, 2013 2:07:00 PM

We have all been in this far too long to get overly excited when the pits fall a few cents - like New England weather, wait and it will change.  

The recent sell off was primarily pinned to the expectation of growing Crude supplies (released this week on Thursday due to the Holiday), a better than expected Jobs report, and the talk of unwinding the government bond buying program.  That all came to a halt this morning as renewed concerns of global strife, specifically Libya, filled the newswires.  

Brent Crude surged early and brought the US markets along for the ride. Still, I have to give weight to some of the technical aspects, as HO has bounced higher again after touching the 2.85 level.  Recall, this has been the much talked about seasonal support level that has yet to be broken for more than a session.   

Heat still remains comfortable trading in the wide range of 2.85 to 3.05, with small breakouts to either side.  One would expect RBOB to get more volatile as global demand expectations have recently been revised higher and the current values appear to be relatively inexpensive.   

At the close, Crude gained .84 to $93.88, RBOB closed up +.0416, and HEAT settled out +.0445

 

RBOB Close
                      CLOSE     CHANGE            
DEC   2.6280         +.0416
JAN   2.6131         +.0387
FEB    2.6180         +.0359
MAR    2.6304         +.0337
APR    2.8004         +.0323
      MAY   2.7990         +.0344      
HEAT Close
      CLOSE            CHANGE
DEC   2.8977        +.0445
JAN   2.9014        +.0434
     FEB    2.9041        +.0419     
 MAR   2.9024        +.0405 
APR   2.8988        +.0393
 MAY   2.8955        +.0386 

heat chart 2013 november

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Topics: Brent Crude, Jobless numbers, Libya, Market analysis, CRUDE, RBOB

Market Finally Falls after Calm Weekend

Posted by Mark Pszeniczny on Apr 11, 2011 9:58:00 AM

Futures tumbled today after seeing double digit increases in the HEAT pit on Friday as fear of prolonged unrest overseas and the possibilty of a Governmental shut down loomed.  At the eleventh hour a deal was struck to keep the U.S. Government running with both sides claiming victory.  New reports this morning had Libya tension cooling as a proposed peace deal is on the table.  The problem is, the deal calls for Gadhafi to remain in power.  As one would expect, the deal has been accepted by the current regime but rejected by rebel forces.  It was somewhat relieving to see our first down day in the last nine sessions.  We are all looking for a healthy correction of the speculative buying that has pushed HEAT higher by almost 20 cents in the last 10 days.  With warm air finally making its way into the Northeast, we should see some length get pulled out of the HEAT pit.  At the Close, CRUDE fell $2.87 to $109.92, RBOB lost .0602 to $3.2005 and HEAT tumbled .0672 to $3.2525.  As we have said many times, one day does not make a trend, but it would be nice if this was the start. 

 
Daily Heat Chart
heat map
RBOB CLOSE
                 CLOSE       CHANGE MAY    32005       -.0602
JUN    31867        -.0595
JUL    31741        -.0590
AUG    31562       -.0589
SEP     31305        -.0597
OCT    29909        -.0625
HEAT CLOSE
          CLOSE    CHANGE
MAY    32525       -.0672
JUN    32647       -.0645
JUL    32784       -.0620
AUG    32931        -.0591
SEP    33085       -.0571
OCT    33230        -.0556
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Topics: HEAT, government shutdown, Libya, Market analysis

Middle East turmoil causing price surge

Posted by Mark Pszeniczny on Feb 21, 2011 10:08:00 PM

Presidents Day is historically a quiet day as most participants are off for the long weekend, but today’s moves have bucked the historical trend.

Values have surged in electronic trading up over .08 cents on HEAT and over .06 cents on RBOB. Crude is currently trading at $91.42 up $5.22! On what do we owe this pleasure? Over the weekend continued political unrest came to a head in Libya as forces fired on crowds marching for the overthrow of the Gadhafi regime. Gadhafi, in recent years, appeared to be kowtowing to the West. As the movements seen in Egypt spread throughout the Mid East and into the OPEC member nation of Libya, many investors are playing it safe and have pushed HEAT back up to the $2.80 level. New reports have Gadhafi fleeing to Venezuela overnight, but have yet to be confirmed. The ultimate fear is not that Democracy will spread to the region, but that a regime worse than what is in place takes power and impedes production. This instability could not have come at a worse time for the Oil markets, already what most contend to be largely overbought trade. Libya exports about 1m bbls per day, certainly one of the smaller OPEC nations, and easily absorbed if the 1.6 billion barrels of strategic reserves were tapped, but significant none the less. Long term, this appears to be a good thing, we just need to live through the short term pains.

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Topics: Libya, Market analysis, OPEC

NYMEX reverses on economic news, to end day higher

Posted by Mark Pszeniczny on May 24, 2010 8:36:00 PM

The early morning session had all the makings of another big down day as news spread that China may be scaling back some of their economic recovery plans. And fears mount that Japan is not too far behind. The reverse came as existing home sales reported a better than expected increase in units. The dramatic sell off in the last few week has brought out the bottom feeders and judging by the chart below, they appear to be ready to turn this around. We had pinpointed the 1.8850 level as a possible bottom and so far that support level has held, this goes all the way back until the first week of February. The real question is there enough steam in the train to move south even more after the two day dead cat bounce. Even with the Dow soft, I tend to think that the 45 cents lost in value in the last two plus weeks has shaken the tree enough prior to the summer. At the end of the day Crude managed to stay above $70 closing up .17 to $70.21, RBOB added .0096 to $1.9708 and HEAT gained .0026 to $1.8993.

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Topics: Market analysis, The Market, NYMEX

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