energy

MCX Crude Oil Jan trade in a tight range on Tuesday, as major international market remained closed for New Year celebrations. US and UK financial market will remained closed for the day on the account of New Year holiday.

MCX Crude Oil Jan opened at Rs. 3772 per barrel and remained in a tight range of 3770-3780, Similarly MCX Natural Gas Jan contract opened at Rs. 293.50 per mmBtu and remained in a tight range of 292-296.

Iran on Sunday said that it will begin operation of the country's first nuclear power plant in the summer of 2008 using half its 1,000 megawatt capacity. Iran, the second largest Opec producer, already faces two rounds of UN sanctions for its uranium enrichments programme and the announcement may increase tensions with the West.

Geopolitical tensions were already high due to a series of Turkish military attacks of Kurdish militant targets based in northern Iraq and as assassination of former Pakistani Premier Benazir Bhutto led to unrest in the nation raising concerns about stability in the region. However the govt. claimed that normalcy has returned today.

MCX Crude Oil Jan (Daily Chart)

Technical Outlook:

Momentum studies have turned bullish; will tend to support reversal action if it occurs. The daily stochastics have crossed over up which is a bullish indication. The stochastics indicators are increasing from over sold level, which is bullish and should support higher prices. The market's short-term trend is positive as the close remains above the 18-day EMA. The downside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Crude Oil Jan: Buy at 3740-20 for target of 3815 and 3860 with stop loss below 3705



MCX Natural gas Jan (Daily Chart)

Technical Outlook:

Momentum studies are still bearish but are now at oversold levels and will tend to support reversal action if it occurs. The daily stochastics have crossed over down which is a bearish indication. The stochastics indicators are decreasing from overbought level, which is bearish and should support lower prices. The market's short-term trend is negative as the close remains below the 9-day moving average. The upside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Natural Gas Jan: Buy at 290 for the target of 315 and 325 with stop loss at 280

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