energy intraday

Energy Apr 30, 2008

Expected Weekly EIA Inventory:

Event Survey


Prior-2421K

expect -950K

Major Headlines:

A stronger dollar gave investors another reason to sell crude Tuesday, Commodities such as oil are less effective hedges against inflation when the dollar is gaining ground, and a stronger greenback makes oil more expensive to investors overseas. Analysts believe oil's run from $65 a year ago to a record near $120 Monday has been fuelled in large part by the dollar's protracted decline.

Oil prices plunged as workers at Scotland's biggest refinery returned to work on Tuesday after a recent strike, while expectations for the dollar to strengthen dampened sentiment for commodities across the board.

Crude oil futures fell over $2 a barrel on Tuesday as fears over U.K. supply eased and the dollar strengthened. Workers at Ineos' Grangemouth refinery in Scotland ended two-day strike, signaling the eventual restart of the 700,000 barrel-a-day North Sea Forties Pipeline System, or FPS.



The Grangemouth strike has come to an end and some people have seen this as a bearish sign, putting the market under pressure, But the fact that it may take a week or more for the oil flow to reach full capacity (has) kept any correction underpinned


The market will also be keeping a close eye on Nigeria, a major supplier of oil to the U.S., where a work slowdown and militant attacks have cut production.

Nigeria is clearly the key problem facing the energy markets right now, and has the potential to reignite the price advance if supply glitches drag on for much longer, or more ominously, if the majors decide to walk away from the country altogether, something they have done on prior occasions

Energy prices fell sharply Tuesday as the market-absorbed data showing demand is falling even as supplies are rising. Gas prices inched higher at the pump, continuing their record-breaking press toward $4 a gallon



Natural gas futures fell Tuesday as private forecasters called for mild, normal temperatures in the U.S. Midwest and Northeast from May through August, indicating gas demand might be flat or lower compared to recent years.



Earthsat and other private forecasters are predicting normal temperatures in the large gas consuming areas of the Midwest and East, based on data over the last 30 years. If anything, this summer is expected to be cooler than the last three in Chicago, New York, Boston and other areas east of the Mississippi, Setree said. Temperatures in the desert Southwest and parts of Texas could rise above normal this summer, according to Earthsat.


MCX Crude Oil May

Technical Outlook:The daily stochastic have crossed over up which is a bullish indication. The stochastic indicator is 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 9-day EMA. The downside closing price reversal on the daily chart is somewhat negative.

Market is expected to remain positive and the resistance is seen at 4739 levels. If market breaches 4739 may see prices to take further upside towards 4802and 4851 however if it holds back below 4627 may see prices to fall further on today. Major support is seen at 4578 and 4515

Recommendations-MCX Crude Oil May: Sell at 4730 Target 4645 and 4600 Stop loss 4780

MCX Natural gas May

Technical Outlook:The daily stochastic have crossed over up which is a bullish indication. The stochastic indicator is 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 9-day EMA. The downside closing price reversal on the daily chart is somewhat negative.

Market is expected to remain positive and the resistance is seen at 442.30 levels. If market breaches 442.30, may see prices to take further upside towards 448.70 and 454.270 However if it holds back below 430.40 may see prices to fall further on today. Major support is seen at 424.90 and 418.50

Recommendations-MCX Natural Gas May: Sell at 447 Target 440 and 435 Stop loss at 452

MCXARUN
9994500540