energy

Nymex crude oil lost almost 2.69% on Tuesday following selling in Bullion and Base metals with weak economic data and Crude oil inventory expectation. Mcx Crude oil was trading below Rs. 3600 per barrel and closed with heavy loss of more then 2%. While MCX Natural gas followed the crude oil movement and was trading in the range of 319-329

· The U.S. Energy Department's weekly report tomorrow will probably say stockpiles of crude oil and distillate fuel, a category including heating oil and diesel, increased last week.Saudi Arabia, the biggest crude exporter, said it has spare capacity equivalent to 2 million barrels of oil a day.

· U.S. President George W. Bush, on his first visit toSaudi Arabia, urged the Organization of Petroleum Exporting Countries to pump more oil in an effort to lower near-record crude prices. The group is scheduled to meet on Feb. 1.

· OPEC will consider stockpiles in consuming countries and ``raise production when the market justifies it,'' Saudi Oil Minister Ali al-Naimi told reporters inRiyadh today.

· Iran is Opec's second largest producer and is conflict with theU.S. over a variety of reasons including its stand on continuing with its nuclear research.

· As per Dow Jones newswires report, Israeli Prime Minister told Monday that Israel rejects no options to block Iran from obtaining nuclear weapons. This comes after U.S. President on Sunday said thatIran is threatening the security of the world, and that theU.S. and Arab allies must join together to confront the danger before it's too late.

· Meanwhile, the International Atomic Energy Agency said Sunday thatIran has agreed to clear up remaining questions on its nuclear program in four weeks, as reported by Dow Jones newswires. AlsoIran said it recognizes only IAEA as an official negotiator over its nuclear issue.

MCX Crude Oil Feb (Daily Chart)



Technical Outlook:

Momentum studies are 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. The 9-day

Recommendations:

MCX Crude Oil Feb: Sell at 3635-40 for target of 3580 and 3535 with stop loss below 3685

MCX Natural gas Feb (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 Natural Gas Feb: Buy at 317-320 for the target of 329 and 336 with stop loss at 313

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