All three contracts making up the energy complex are poised to close out this week with additional gains. Prompt month crude oil, gasoline, and diesel futures are all looking to close out today with 1.2% gains for the week.
This week’s upward action has seemed more of a rally-for-rally’s-sake rather than one particularly inspired by technical or fundamental factors. Strong production and supply figures combined with the essential uselessness of OPEC’s supply cut do not provide good footing for bulls. While technical indicators don’t look particularly dissuasive of a further run-up in prices, they definitely aren’t helping as most remain neutral.
Things are all quiet on the Atlantic front right now with no potential storms worth mentioning in development. Dry air coming off of the west coast of Africa is currently suppressing any storm from forming for at least the next five days.
The prompt month gasoline futures contract is trading around its 200 day moving average, an important resistance level. If the contract can manage to settle above the $1.5450 level, technical traders might have reason to start buying while a failure to breach that level might set prices back short term. It’s a similar story with diesel, only its 100-day MA wants to test the rally’s mettle at around $1.5150.