Thrusday March 4th, 2010

The energy market has finally taken a rest. We hit a seven week high on crude yesterday, in the face of a bearish crude DOE report. Crude had builds of 4.1 million bpd, but was still able to jump with the help of a weak dollar. Today crude closed down .66 cents to land just above the $80 dollar mark at $80.21. Heating oil decided to take the day off, and fell .025 cent to close at $2.0687. Gas was down .0138, which isn't much in relationship to its two week rally. Gas has seen gains of about .15 cents in the last two weeks. It seems each day some kind of mass media is threatening $120 plus crude by mid summer and $3.50 gas. I am not sure how much faith I would put into the mass media hysteria, but if you are thinking about diesel prices, its not a bad idea to fill the tank for spring and possibly look at contracting a medium portion of your needs. Technically speaking today's close while lower, still feeds the bulls as the market was unable to settle below the $80 mark. This weeks trade has really tested the $80 mark, but just can't seem to shake it. Some key numbers to watch as we close the week are of course the $80 mark on the low side and $83.95 mark on the high side, which was the January high. If in the next couple sessions the market is unable to settle below $80 look for a quick run up to the $84 mark; Of course product will follow suite.
One thing I have noticed of late has to do with time frame, or clock management for you sports fans, the bulls really seem to be in control of the game. Bad news doesn't last long and then its off to the races for the bulls. I say this, because it has been very small windows of time to take advantage of dips, before its to late. Basically the opposite of the grain market, a very small window to take advantage of the gains. Well ... that's my armchair philosophy of the week, pay attention and take advantage of the small breaks, because it looks like fuel is getting more expensive than the rules of supply and demand say it should.
Thanks for reading,
Zach Winter