Crude and Products Futures Drop on Nymex, but Traders Expect Rally to Greater Heights

Strategic Insights -

Monday's trade on the New York Mercantile Exchange (Nymex) saw crude and products futures decline, yet analysts and traders believe this downward correction will pave the way for a larger price rally. The market was generally quiet, with most energy complex trading confined to narrow price ranges. March light, sweet crude futures, now in their first day as the spot futures contract, retreated by 32 cents to $18.10 per barrel, representing the lower end of a 42-cent trading range.

Key Takeaways:

  • March light, sweet crude futures dropped by 32 cents to $18.10 per barrel, within a 42-cent daily trading range.
  • Technical analysts from Pegasus Econometric Group expect a potential retracement to $17.69-$17.50, while remaining bullish.
  • A further drop in crude prices is expected before hitting technical resistance levels of $18.72, $19.00, and $19.27.
  • April crude futures fell 25 cents to $17.97 per barrel, and May dropped 21 cents to $17.88 per barrel.
  • February gasoline futures dropped 1.02 cents to 56.38 cents per gallon, with technical support pegged at 55.88 cents to 54.68 cents.
  • Analysts downplay the impact of tight supplies, attributing the rally to psychological bearishness rather than real market conditions.
  • February heating oil futures slipped 0.32 cents to 47.82 cents per gallon, and March dropped 0.40 cents to 47.97 cents per gallon.
  • February natural gas futures fell 3.6 cents to $1.389 per million British thermal units (MMBtu), and March plummeted 7.1 cents to $1.386 MMBtu.

Statistics:

  • Crude prices dropped by $0.32 for March light, sweet crude futures.
  • The daily trading range for March light, sweet crude futures was $0.42.
  • Technical support for February gasoline futures is between 55.88 cents and 54.68 cents per gallon.
  • April crude futures fell by $0.25 to $17.97 per barrel.
  • February heating oil futures dropped by 0.32 cents to 47.82 cents per gallon.
  • Natural gas futures fell by 3.6 cents to $1.389 MMBtu.

Sources:

  • Bloomberg News
  • Pegasus Econometric Group
  • International Petroleum Exchange