ALERT: EXPECT LITTLE FROM OPEC.
 
PETROLEUM MARKET

NYMEX players are again presented with a fairly tight range from which a directional cue will be hard to glean. Trading remains range-bound ahead of he OPEC meeting scheduled tomorrow in Vienna. Weakness in the dollar index is sparking some fresh buying of crude oil, but in the final analysis, fears over the slowing global recovery and the disappointing domestic economic performance is increasing the downside pressures on crude as market participants conclude demand prospects are dismal. While there has been some speculation that the cartel is going to increase their production quotas, we'll believe it when we see it. As usual, some nations, like Venezuela and Iran , will choose to  ignore the outcome of rising prices others like Saudi Arabia worry that the rally will curtail growth and accordingly lead to the drop in demand and oil prices.  

 
TECH TALK

Crude prices just refuse to break below 98.11. Expect another short-lived foray to perhaps the 102.00 area. But the range bound trading will probably continue until the market receives a fresh directional cue. The bias remains neutral until the current zone is breached significantly. In case of another recovery, expect upside to be limited by 104.60 resistance. The decline from 114.83 is still underway and a break of 94.63 will open the way to 90.00, more for psychological reasons than anything else.  A rebound will target the old high of  114.83.
 

NATURAL GAS

Gas pushed back up to recent highs on anticipation of another bout of early summer heat.  Temperatures may be as much as 8 degrees above normal in parts of the Midwest and Northeast through June 10. Still, the market has yet to break up to cover significant new territory. Perhaps, the idea that global natural gas use may rise more than 50% by 2035 to overtake coal as the second-most used fuel, as EIA said today in a report is galvanizing traders psyches' as well. More likely though the immediacy of NOAA's report that cooling degree days should be 11% higher year over year and 22% above the long-term average this week.. Over the next few months, the markets will be attentive to the hurricane season as it builds up to a peak in the fall. The National Hurricane Center reports a 40% chance of a tropical cyclone in the central and western Caribbean sea this week, signaling that hurricane season has kicked off. Still, the inability to generate enough momentum to break to new highs shows the market's inherent weakness, a consequence of ongoing structural imbalances.
 

TECH TALK

Despite posting a new high above 4.85 for this particular move, the market appears to be losing upward momentum with its inability to break even higher. There is an active buy signal with settlement moving even further away from the moving averages. But some price action below today's support of 4.807 shows some loss of momentum. The successive highs right about in the same area is a sign of weakening, as well. Still, the lower highs over the last couple of sessions point to the waning strength, and the upside break of 4.729 resistance has turned the bias to the upside, where it remains; further gains will be harder to come by.
 

source: KilduffReport.Com