Written Commentary
CRUDE OIL
While the charts in the crude oil market look as if the short-term trend has turned down, fading the bull camp in crude oil has been a very damaging undertaking for months. For instance, the December crude oil contract showed significant downside volatility early yesterday, but prices ultimately recovered and finished at a contract high close. The upcoming weekly EIA data on US oil production will become more important in the weeks ahead.
While the gasoline market yesterday failed to make a new contract high, the December contract spent most of the Tuesday trading session in positive territory and within two cents of contract highs. However, the December contract has failed early today and looks to encounter a key pivot point at $2.40 early on.
NATURAL GAS
The natural gas market continues to show significant volatility, but the trade did manage a higher high and spent significant time yesterday above the psychologically important $6.00 level. The natural gas market is likely deriving fresh buying interest from reports that Chinese power plants are securing all the feedstock supply necessary to heat homes in the coming winter.
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