Energies Review On Feb 8th
Crude oil called lower by more than $1 as the liquidation still continues after the huge premium flatprice following the political issues in Egypt. The supply and demand fundamentals are settling back into the market as crude oil falls below $87.00 this morning as it has broken support there. WTI spreads are still the main story with H/J breaking -300 to trade -325 as the shorts finally broke great support there after countless tries to get below -300. Dec11/Dec12 also breaking -100 as this market is looking to go lower here as well. Watch for API reports coming out after the bell today as this will likely be a huge catalyst for flatprice. I would like to buy on the dip as my next support level is $82 but the market still has another $4 to go on the downside.
Natural gas is liquidating the last few days as well with March natural falling below $4.10 as a couple of concerning in inventory reports have done this market in. Look for natty to have a solid base at $4.00 and I would recommend getting back in around these prices.
- Daniel Cronin, Energies Guru