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Upside Breakout in Crude


With crude oil market yesterday rejecting selling and recovering with an upside breakout today and managed that action in the face of dollar strength and equity market weakness. The upside breakout in crude oil this morning is justified by the US job openings and labor turnover report from yesterday which showed the largest amount of unfilled available jobs ever as that speaks of improvement in the US economy and the likelihood of improved energy demand.

The gasoline market also ranged down sharply with a 5-day low yesterday before rebounding by $0.06 from the initial low in a sign that traders are in a bargain hunting buying mood.


A weaker opening this morning is likely the result of the EIA forecast yesterday that US natural gas production next year would jump up to 93.9 BCF per day versus a previous forecast of 93.12 BCF per day. Supporting prices against the initial weakness is a prediction from the EIA that June US natural gas consumption will be higher than in a forecast released in May.

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