ALERT:BERNANKE HINTS AT QE3 - MOODY'S HINTS AT USA DOWNGRADE
 
PETROLEUM MARKET

Crude oil prices remained strong yesterday, bolstered by Bernanke's remarks signaling more stimulus might be coming if the economy weakens and by data showing a drop in crude stocks. It should be noted however that Cushing stocks, however, climbed to 37.65MM/bbls. Continuing accommodative monetary will weigh on the dollar to oil's benefit. Accordingly, the closely watched dollar index posted its worst performance against a basket of currencies in almost a month, falling to a record low against the Swiss franc. IEA said global oil demand would rise in 2012 to 91 MM/bpd, while simultaneously cutting its overall 2011 and 2012 demand growth forecast. With overnight price action confined to a modest $1.03 range, participants will probably take their next directional cue from weekly jobless claims due later this morning. Overnight price action has been contained within a relatively modest $1.03 range without posting a new high on fairly good volume. This inconsequential price action should receive a directional cue when weekly jobless claims are released.
 

TECH TALK
 
The intraday bias remains somewhat to the upside, but with to the upside. But with 102.44 resistance intact the larger decline from 114.83 should continue. This view takes some additional weight from the fact that there has been a succession of lower highs since the rebound from 89.61. A breakdown to 94.74 would be needed for confirmation. If it comes a zone of support at 83.65-84.00 would be targeted. A settlement above 100.00 though would place 106.10 in the cross hairs.
 
 
NATURAL GAS

Record mercury readings persist as the main driver of the market's fourth consecutive day on the updside. Market participants are betting that cooling load will continue to be supportive, and of course, that is a very convincing fundamental. Above-normal temperatures are expected to linger, although  it isn't clear if natural-gas futures will continue their rally, with momentum waning. The next directional cue will come from EIA , with the release, later this morning, of weekly storage figures. We think it will show 84 bcf was injected in the latest reporting period. If however, a reading of 70bcf or below is reported,  the market could push through 4.50 or higher. Alternatively though, if the reading is closer to our estimate, which is a bit above consensus, the market will probably snap its current streak.
 
 
TECH TALK

The  breach of resistance at 4.411 suggests that a short term bottom is formed at 4.064 This argument may be strengthened by noting that while key support was broken last week as the market slid to a three-month low of 4.064, there was no follow-through to the downside. The bias will remain neutral to mildly on the upside, for the moment, as the market looks to continue range-bound, with decent buying near 4.00 but more selling as prices approach 4.50. Holding 4.223 minor support will indicate that recovery from 4.064 is finished and will flip bias back to the downside for retesting this support. A break of 3.731 support will target 3.255.
 
 

source: KilduffReport.Com