ALERT: QADDAFI LOYALISTS GAIN LOST GROUND, LEADER PLEDGES TO ONLY SELL OIL TO CHINA, INDIA AND RUSSIA.  REBEL LEADER SAYS, "INTERNATIONAL COMMUNITY HAS FAILED US."
 
PETROLEUM MARKETS

Prices are up over $2.00, rebounding from a two week low as forces loyal to Libyan leader, Col. Qaddafi appear to be retaking ground previously held by insurgents. Elsewhere, Bahrain security forces drove protesters from their rallying points in the capital Manama. Even though Japan continues to suffer aftershocks and nuclear danger from the quake that has shut factories and refineries, seriously constricting global energy demand, the threat to the Saudi oil fields has trumped that once again. No one is ready to declare the entire northeast portion of Japan a nuclear "dead zone" just yet, but the immediate threat to supply is real. This is why we remain bullish across the board, at least for the very short-term. What is all too real, however,  is the imperiled recovery that results from rising oil prices hence the expected fleeting conviction of our bullish call.
 

TECH TALK

Crude prices may mimic the the congestion zone from 2/23 -- 3/1, as prices make a move above $100 or below $95. Overall, however, crude oil's pull back from 106.95 is still in progress and a further decline towards 88.00, where all of this began, might be possible. Prices moved below the 10-day moving average on Friday's settlement and extinguished an active buy signal, and dramatically shows the front of the market's weakness. Gap support should hold but if it does not prices could challenge 90.00 very quickly after that . For the moment though, technicals take a back seat to the headlines.
 
 
NATURAL GAS

Gas' three day winning streak has been ignited by the idea that Japan will increase demand for liquefied natural gas as a consequence of quake damaged nuclear reactors. Prices dropped in earlier trading as forecasts for warmer than usual weather in the U.S. signaled a drop in demand, but later Gas gained 0.7% after it was announced that a third explosion and fire struck Tokyo Electric Power Co.'s Fukushima nuclear plant. Additionally, gas for winter delivery rose to the highest price in more than two years in Europe as Germany said it will halt its seven oldest nuclear plants as part of a safety review after the explosions in Japan.
 

TECH TALK

Natural gas  is still staying in range of 3.731 and 4.10 for the moment, and further consolidation is possible. Resistance should be strong from 4.1, limiting the upside. Other indicators remain very bearish with moving averages still arrayed to depict a falling market, but the 10-day has been violated by a gently rising market. Price action near the pivot is inconclusive as well. One may pare shorts near 3.80 or stop them out at 4.10 but do not open new positions within that band.

source: KilduffReport.Com