Energy intraday

Major Headline:

- Crude oil fell a second day on signs that slowing economic growth in the U.S., the world's biggest energy consuming country, will curb fuel demand. Oil prices continued lower as a reduction of tensions in the key Iraqi oil city of Basra helped eased supply fears.

- Fighting centred in the south of the country between Shia militias led by cleric Moqtada Sadr and Iraqi forces had contributed to oil's rally last week, as the southern port city of Basra is the conduit for the majority of Iraq's crude exports.

- Over the weekend, however, Moqtada Sadr ordered his Mehdi Army off the streets, reducing the risk to supplies. Reports from Basra have shown the Mehdi Army have disappeared from the streets today, signalling an end to the firefights which have killed more than 320 people since last Tuesday.

- Downward pressure is also being exerted by concerns over the strength of demand in the United States as the world's largest economy teeters on the brink of recession.

- American crude stockpiles have been rising in recent months, reducing market tightness. With seasonal demand lower in the second quarter and concerns a recession could further cut in to America's oil needs, some analysts think prices are ready to retreat from recent highs.

- Prices have been supported by ongoing weakness in the U.S. dollar, which makes commodities denominated in the U.S. currency cheaper for overseas investors.

- The dollar's steep slide has also seen speculative funds -- looking to hedge against weakness in the greenback and the recent widespread financial turmoil -- buy into the crude market.

- Long-term concerns about the ability of producers to meet booming demand from the developing world is also helping to lend a floor to prices, with many market watchers attributing crude's move above $100 to fears that supplies could fall short.

MCX Crude Oil April

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 EMA. The upside closing price reversal on the daily chart is somewhat positive.

Recommendations-MCX Crude Oil April: Sell at 4120 Target 4010 and 3960 Stop loss 4170


MCX Natural gas April

Technical Outlook:

Momentum studies are bullish but are now at overbought levels and 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 rising from oversold level, which is bullish and should support higher prices. The market's short-term trend is positive as the close remains above the 21-day EMA. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations- MCX Natural Gas April: Buy at 397 Target 410 and 413 Stop loss 392

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