Technical Analyst, Saxo Bank
Summary: WTI and Brent crude oil bouncing from retracement level. Can the establish bullish trend or be failing once again?
Henry Hub gas established uptrend, but it is fragile with Indicator not confirming. Will It slide back?
Dutch Gas bouncing from strong support but strong resistances overhead
WTI Crude oil bounced off the 0.786 retracement at 69.52 and currently testing the 0.618 retracement, close to testing the upper falling trendline. If that scenario plays out followed by a close above 76.18 an uptrend has been confirmed with a likely move to 1.382 projection at 78.81, possibly spiking up to test the strong resistance at around 79.11
An RSI close above 60 will confirm a bullish scenario
Brent Crude oil retraced almost 0.786 of the late December bullish move. Currently testing the 0.618 retracement the upper falling trendline could very well be tested.
A break above is likely leading to a move to December peak at around 81.72. A close above is likely to push Brent to the 1.382 projection at around 81.30
An RSI close above 60 will confirm a bullish scenario
If Brent is sliding back taking out 74.81 selling pressure is likely resuming pushing Brent to test 72 once again
Dutch TTF Gas has bounced off support at around 30.50. However, whether the Gas contract can establish a bullish trend is still up in the air. Minimum requirement is for Dutch Gas to close above 37.60.
A break above the upper falling trendline would be first indication of the strong resistance at 37.60 is to be tested
A daily close above 37.60 is likely to push the Gas price higher towards 40.25 possibly spiking to around 43.
If Dutch gas breaks back below 30.50 a sell-off down to around 22.85 is in the cards
2024: The wasted year
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As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
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Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.