Economic Disappointment Increases Resistance for Energies
CRUDE OIL
While the crude oil action has remained in an upward slope, ranges and net gains have been very limited potentially sending off signals of waning bullish momentum. However, weekly crude oil stocks did decline, despite a large jump in US imports and in the face of a continuation of massive refinery capacity being held off-line. As in many other markets, the crude oil trade should be disappointed today by the lack of proactive stance from the US Federal Reserve at the end of last month as that has resulted in a downgrade in economic expectations which in turn downgrade energy demand prospects.
NATURAL GAS
While the natural gas market has clearly benefited from the recent pattern of hot temperatures in the US and forecasts overnight show a slight expansion of the extreme heat area in the southwestern US, we suspect the focus of the natural gas market is poised to shift to a pair of tropical storms already in the Caribbean. While Atlantic formed storms can track into the Gulf of Mexico, the natural tendency is for those storms to veer away from the US coast due to the Gulfstream.
Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.
ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.
A subsidiary of Archer Daniels Midland Company.
© 2021 ADM Investor Services International Limited.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.