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Lower Energies Outlook


Clearly the crude oil market was technically and fundamentally overbought into Monday’s highs with prices yesterday reaching over $40 per barrel, or twice the level seen in late April. With the most recent positioning report showing crude oil to be net spec and fund long 605,164 contracts and the market after the report gaining $3.50, the net spec and fund long should be the largest since the 3rd quarter of 2018.


While we are interested in picking a key low in natural gas at some point soon, we have to leave the near term edge with the bear camp and leave open the opportunity for new contract lows. In short the natural gas market remains under a bearish bias with the market unwilling to anticipate improvement in demand until data confirms strengthening demand from electrical generation.

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