ALERT:MOMENTARY RELIEF OVER GREECE. IT WILL NOT BE THE LAST WORD.
 
PETROLEUM MARKET

Another week jobless claims are "only" 428K. What is there in the world good about economic data like that, a full two years into a recovery. We have been saying vociferously in this space, since the recession's end was declared in mid-2009, that we saw no growing body of incontrovertible evidence  of a sustainable recovery. We still don't. Unemployment stubbornly persists which means that consumer spending, which necessessarilly has to be the driver will remain constrained. Markets may take momentary solace as policymakers just push the problem a little further down the road, like yesterday, but it is not the end. Stockpile reports showed  a significant fall in crude oil, but that was mainly attributable to a fall in imports. Commercial stockpiles are still near 360MM bbls, more than ample supply. Also, the release 3MM bbls from the SPR over the next month could contribute to crude imports falling further in the coming weeks. The fundamental picture for crude oil does not look particularly friendly right now, but that has not stopped bulls from stampeding before.

We will be suspending publication from July 1st, returning July 5th in observance of Independence Day.
 
 
TECH TALK

There are several very interesting developments on the crude chart. 96.00, which held support on the way down from the break in the bull market last May presented fairly stiff resistance on the way up from recent lows yesterday. On longer term charts like the weekly and monthly, the turn lower still looks like it has a good bit left in it. However, a closer focus suggests that it has run its course and it ready to turn higher. The deciding factor will be how long 96.00 holds, or whether it is breached by a settlement above. There should be more conclusive price action next week.
 

NATURAL GAS

Computer models currently show that Tropical storm Arlene most likely will not affect gas production in the Gulf, allowing NYMEX prices to slip a bit from yesterday. Participants now await EIA report, later this morning, which we think will say that 88 bcf has been injected into storage for the latest period, ahead of the market's expectations of around 80 bcf. Consequently, prices should come under pressure. While the shortfall to last year has been widening we remind that last year was a record and longer term weather forecasts are showing quite a moderation from last year's extremes. Additionally, EIA expects marketed gas production this year to be up. Ergo, do not look for a break out of the range that has prevailed since the end of winter.  
 
 
TECH TALK

The technical picture still presents as bearish in how the moving averages are arrayed and the relationship of current price to the pivot point for today of 4.323. As you can see from the chart though the market has been covering the same ground over and over since April where the market bottomed after a long fall from over $10, posted in mid-2008. Still within that range which is basically, 4.00-5.00, the meat of which is more narrowly focused at 4.30-4.80. within those parameters there should still by many good opportunities. The only thing with range trading is entry points are against the momentary trend. Normally, one would go with directional strength. Now the task becomes more difficult; fading strength and buying weakness. The goal becomes not detecting direction but trying to determine when momentum is running out and going the other way.

source: KilduffReport.Com