Technical Analyst, Saxo Bank
Dutch Gas opened today Monday 19th September below its key support €187.50 and is hovering around the 0.618 Fibonacci retracement at 178.42. Dutch gas Is short-term in a down trend and could drop further to next key support at 152. If that scenario plays out RSI has moved below 40 threshold and turned negative.
But if RSI does not close below 40 a rebound could be seen. There is no divergence on RSI above 60 so if RSI does not cancel that picture by a close below 40 the bullish sentiment is still intact. Bottom line; Today’s trading – or rather the closing of today’s trading - is likely to be key.
Henry Hub gas is testing the key support at 7.55 in what could be the Neckline of a Shoulder-Head-Shoulder like pattern. It is not the most perfect pattern as one could argue it is just huge volatility in a broader time series. To be a perfect SHS pattern there should be no uptrend and peak April through June.
Nevertheless, if Henry Hub gas closes below the (Neckline) support there is room down to June/July lows at around 5.35.
However, there is strong support at the 0.764 Fibonacci retracement at 6.44 where the 200 daily SMA also will add to that support area.
For Henry Hub to demolish this picture a close above 9.24 i.e., the right shoulder is needed.
Brent Crude oil trading in a falling wedge like pattern is likely to have another go at the support at 87.70. If it closes below 87.70 and if RSI breaks below its lower slightly rising trendline with a likely lower value to follow, and Brent is likely to drop further to support at 83.00.
To reverse the selling pressure in Brent it needs to break above 95.80 for a correction around $100.
But to reverse the down trend a close above 105.50 is needed
WTI Crude oil trading in a falling channel is likely to test key support at 81.90 once again. A close below next support is at 78.48 and stronger support at 74.27.
RSIU is back below 40 with no divergence supporting a scenario with lower levels in WTI.
If WTI find buyers that can lift the oil price above 90.20 a correction up to around the upper falling trendline and possibly to around 97-98 could be seen.
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.
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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.