Technical Analyst, Saxo Bank
Dutch TTF Gas has bounced from 0.618 Fibo retracement at €178.42 of the entire uptrend since mid-June. Twice closing above 187.50 the correction in Dutch Gas is likely to over and uptrend to resume.
RSI is bouncing from 40 threshold meaning it is still in positive sentiment and there is no divergence. No divergence indicates Gas could see higher levels – higher than the 342 recorded in June. Resistance around 242.72 and 280.64
If Dutch Gas closes below 181.35 it will put the uptrend scenario on pause – at least short-term – and result in a drop to strong support at 152.
Henry Hub Gas seems to resume uptrend above its key support at 7.55. If Henry Hub closes above $9 August peak around $10 is likely to be tested and broken.
That scenario is likely to play out if RSI closes above its falling trend line.
If Henry Hub gas closes below 7.55 the current correction is likely to turn in to a bearish move down to around the 0.764 retracement and 200 SMA around 6.44.
Brent Crude oil have found support at $87.70. The trend is still down however, and Brent needs to close above the falling trend line to indicate a trend reversal.
RSI is showing divergence indicating a weakening of the down trend and a rebound to around $100 and the falling trend line could materialize. If Brent does break above the falling trend line there is strong resistance at around 105.45. First indication of that scenario could play out a break above 97 is needed.
If Brent closes below 87.70 the bear trend is to be extended down to the 0.764 retracement at 83.40. but lower levels are not unlikely. If sellers can push Brent to close below 83 a d total collapse to around 70 is not unlikely
Carbon Emissions collapsed totally after breaking below 0.764 retracement of the last uptrend and rejection of the peak in August, reaching 1.382 projection of the “Boom and Bust” move.
RSI is at a value just above 20 where last time it reached that Carbon Emission prices rebounded. Perhaps we are seeing identical scenario this time resulting in Carbon prices to bounce to around €75.
However, the trend is still down and if Carbon breaks below last weeks low at 65.55 it could drop to the 0.618 projection at 60.82 but a move down to around March lows at 55 is not out the question.
2024: The wasted year
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.
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.