Energy

Archive for Energy – Page 16

Eight Resource Companies You Need To Pay Attention to

Several companies on expert Adrian Day’s list have either reported quarterly earnings or had other news. In the case of the larger companies, most have already pre-announced production or sales.

Barrick Gold Corp. (ABX:TSX; GOLD:NYSE) reported results in line with expectations, though free cash flows were weak. The company had pre-announced production, as well as overall costs.

The weaker-than-expected free cash flows reduced the net cash balance and, therefore, the dividend, part of which is based on the company’s excess cash balance, to US$0.15 rather than last quarter’s US$0.20.

Nonetheless, the stock price decline — it fell over US$2 from Wednesday to Thursday, to as low as US$13, before a partial recovery Friday as gold jumped — appears grossly overdone and is as much a reflection of investor concern about the gold market, and general concerns about the increase in costs at large miners, than about Barrick in particular.

Organic Growth Beats M&A

CEO Mark Bristow said the company was on track to meet annual guidance at the low end of the range for gold and mid-range for copper.

He emphasized that the company was pursuing organic growth, even though it continues to look at M&A opportunities, adding that those that meet the company’s investment criteria remain “few and far between.”

Barrick has several large-scale organic opportunities, including the Pueblo Viejo expansion, the restart of Porgera, and the new Reko Diq copper project in Pakistan. The company expects to increase reserves, net of depletion, at year-end.

So far this year, it has bought back 1% of its outstanding shares and, together with dividends, has returned over US$1.2 billion to shareholders.

Bristow said the company would buy its own shares when they were materially below intrinsic value, and in comments, he was almost chomping at the bit to start buying shares again, “more, significantly more.”

We should join him; buy.

Another Solid Quarter for Wheaton

Wheaton Precious Metals Corp. (WPM:TSX; WPM:NYSE) saw sales somewhat down, partly a reflection of two modest streams terminated during the quarter and partly a matter of the timing of sales. Ongoing bottlenecks affected sales, though these are being cleared up.

One major positive was the report that Phase 3 at Vale’s Salobo is now 98% complete. Other development projects appear on the track, while a handful of new mines are scheduled to begin construction in 2023.

Given that the last two quarters saw weak results at Salobo, which is Wheaton’s largest single asset, there had been concern that the expansion was being delayed. The company has nearly half a billion in cash, no debt, and US$2 billion on an unused line of credit.

A strong multi-year growth profile, rock-solid balance sheet, and conservative management make Wheaton a top pick. Given the jump in the stock price on Friday, we would hold off adding to positions, though you can take new positions here.

Royal Is on Track for a Strong End of Year

Royal Gold Inc. (RGLD:NASDAQ; RGL:TSX) had pre-released sales, which showed a minor miss of estimates largely due to a weak quarter at Cortez. Access to high-grade ore at that mine is now expected this quarter and will help Royal with a strong end of the year.

The company is maintaining its full-year guidance. This quarter is also expected to include the first royalties from its new Cortez royalty, which were not factored into the company’s full-year estimates. Note that Royal has two royalties on Cortez.

In addition, the Khoemacau copper mine in Botswana, on which royal has a silver stream, expects to have completed its ramp-up by the end of this year or early next. Most importantly, the mine life of oft-troubled Mount Milligan, Royal’s largest asset, has been extended another four years to 2033.

Average annual production is projected at 175,000 oz of gold and 68 million lbs of copper. Royal has streams on both metals.

This had been announced by operator Centerra last month. Royal has US$122 million cash and about $550 million available on its credit facility after paying down another US$50 million during the quarter. It intends to pay down debt further from ongoing cash flow. Royal has some quality assets and near-term growth. It is a buy at this price.

Lara Is a Must Own as the End Game Approaches

Lara Exploration Ltd. (LRA:TSX.V) announced that partner Capstone Copper had earned 49% in the Planalto Copper Project in Brazil after investing more than US$5 million in exploration expenditures. Capstone can move to 51% and become the operator by a US$400,000 payment to Lara, and then move to 61% by delivering a feasibility study.

This news follows the commencement of a new drilling campaign (see Bulletin 838); there is every indication that Capstone intends to continue in the joint venture and potentially look to buy the entire project.

As discussed previously, Planalto is not the only “company maker” that Lara holds. It also controls the Liberdade copper project, also in Brazil, on which it recently won a favorable court ruling in a dispute with Vale; and it owns 70% of the Mantaro phosphate project in Peru, each of which is arguably worth the company’s entire market cap., and potentially far more.

With solid management running a lean operation, Lara is one of my all-time very favorite junior companies. (You can assume that clients of my money management hold all the stocks which I discuss favorably in this unaffiliated newsletter. I should disclose, however, that clients own over 16% of Lara.)

This will be a big winner, but in exploration, things take time. Just as I did with Virginia Gold and then with Reservoir Minerals, I have been thumping the table on Lara repeatedly for a while now. This is one you need to own, and I strongly suspect that the outcome will be just as pleasurable as the outcome was for those other two.

The stock is thinly traded, and you don’t want to drive it up with your own buying. But a year from now, I suspect, it won’t really matter whether you paid US$0.65 or US$0.75, or even more; the important thing is that you own it.

Orogen Implements Strategy While Revenue Increases

Orogen Royalties Inc. (OGN:TSX.V) has optioned the Pearl String gold project in Nevada’s Walker Lane Trend to Barrick, giving it the right to earn 100% of the project in return for a US$1.5 million payment and US$4 million in exploration expenditures.

Orogen will retain a 2% royalty. The often neglected Walker Lane trend in southwestern Nevada hosts Anglo’s Silicon deposit on which Orogen (and Altius) hold royalties.

Separately, Orogen and Altius have signed a generative exploration alliance, looking for new targets geologically similar to Silicon. Altius will make the initial funding, while Orogen will make available its database and exploration team. Altius holds over 16% of Orogen as well as some warrants.

In Mexico, First Majestic announced a production record at its Santa Elena mine, with “strong production” from the Ermitaño deposit on which Orogen holds a royalty. First Majestic, noting that Ermitaño has higher grades than the Santa Elena mine, said it was processing a higher percentage of ore from Ermitaño.

As with Lara, Orogen is a junior you need to own. Closing Friday at 0.40 x 0.42, it is just above its 6-month average price, where it remains a solid buy.

Midland Continues Exploration Success

Midland Exploration Inc. (MD:TSX.V) reported encouraging success from its recent exploration program in the Labrador Trough, part of a strategic alliance with SOQUEM. Several new mineralized horizons were discovered at surface, with very attractive grab samples. The companies will continue their work over the winter, seeking to understand the geologic setting. We would expect the team to be back in the field next summer.

With strong management, a solid balance sheet, and the activity of multiple projects, many with first-class partners, Midland remains a buy.

Vista Cuts Costs as Deal Process Takes Time

Vista Gold Corp. (VGZ:NYSE.MKT; VGZ:TSX), in its third-quarter report, noted that it was advancing work to maximize value on its Mt Todd project, focusing on controlling costs while the process was ongoing. Fixed-cost spending is running 15% under the US$7 million budgeted for the full year; most of those reductions have been in personnel costs.

And the company also expects a reduction in discretionary spending now the feasibility study and drilling programs are complete; it spent just under US$1 million at Mt Todd in the quarter.

However, even at the reduced rate, its US$9.6 million cash as of the end of the quarter, healthy though that is, represents little more than one year’s worth of expenses. Hold.

Gladstone Performs Well in Difficult Environment

Gladstone Investment Corp. (GAIN: NASDAQ) reported a strong quarter with adjusted Net Investment Income, a key metric for Business Development Companies, of US$0.29, up from US$0.25, and total investments valued at US$738 million, up from US$690 million at the end of June.

The company made one new investment of US$39 million, and it recapitalized an existing investment adding another net of US$20 million. The portfolio suffered a small decline in valuations, largely the result of lower multiples being assigned.

Gladstone reported that its portfolio companies were meeting the challenges of the economic environment and higher interest rates, and in fact one company came off non-accrual status, leaving just two companies on non-accrual.

New Dividend Equals Over 10% Yield

As a result of the strong performance, the company increased its monthly dividend by almost 7%, and it announced another supplement distribution of US$0.12. If the company can make similar extra distributions in the coming 12 months, the forward yield would be over 10%. It yields a healthy 6.9% just on the monthly dividends.

With a high yield, a strong balance sheet and low leverage, and growth opportunities, Gladstone remains a long-term holding. However, with the stock price up sharply after its results — and it is up from under US$12 a share three weeks ago — we are holding.

BEST BUYS this week are few; given that the markets have rallied recently, and the gold and resource stocks in particularly jumped sharply on Friday, we are not chasing, even though many of the prices remain attractive on a longer-term basis. In addition to those above, buys this week include Agnico Eagle Mines Ltd. (AEM:TSX; AEM:NYSE) and Nestle SA (NESN:VX; NSRGY:OTC).

Adrian Day Disclosures:

Adrian Day’s Global Analyst is distributed for $990 per year by Investment Consultants International, Ltd., P.O. Box 6644, Annapolis, MD 21401. (410) 224-8885. www.AdrianDayGlobalAnalyst.com. Publisher: Adrian Day. Owner: Investment Consultants International, Ltd. Staff may have positions in securities discussed herein. Adrian Day is also President of Global Strategic Management (GSM), a registered investment advisor, and a separate company from this service. In his capacity as GSM president, Adrian Day may be buying or selling for clients securities recommended herein concurrently, before or after recommendations herein, and may be acting for clients in a manner contrary to recommendations herein. This is not a solicitation for GSM. Views herein are the editor’s opinion and not fact. All information is believed to be correct, but its accuracy cannot be guaranteed. The owner and editor are not responsible for errors and omissions. © 2022. Adrian Day’s Global Analyst. Information and advice herein are intended purely for the subscriber’s own account. Under no circumstances may any part of a Global Analyst e-mail be copied or distributed without prior written permission of the editor. Given the nature of this service, we will pursue any violations aggressively.

Disclosures:

1) Adrian Day: I, or members of my immediate household or family, own securities of the following companies mentioned in this article: All. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: None. My company has a financial relationship with the following companies mentioned in this article: None. Funds controlled by Adrian Day Asset Management, which is unaffiliated with Adrian Day’s newsletter, hold shares of the following companies mentioned in this article: All. I determined which companies would be included in this article based on my research and understanding of the sector.

3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.

4) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services, or securities of any company mentioned on Streetwise Reports.

5) From time to time, Streetwise Reports LLC and its directors, officers, employees, or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in the securities mentioned. Directors, officers, employees, or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company release. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Wheaton Precious Metals Corp. and Agnico Eagle Mines Ltd., companies mentioned in this article.

Energy Opinions

10 Nov

Clean Nuclear Med Tech With Quantum Blue Sky

Source: Penny Queen (11/9/22)

With MedTech ASP Isotopes hitting NASDAQ tomorrow, expert Penny Queen reviews the company to tell you why she believes it is worth your attention.

This week, ASP Isotopes will be hitting the Nasdaq as $ASPI.

They hold an exclusive, global license for the aerodynamic separation of isotopes, essentially a much less expensive and environmentally friendly method of harvesting and enriching natural radioactive isotopes for medical scans and treatments.

These are not by-products of nuclear energy reactors.

Their technology has much broader (and even more lucrative) potential than the medical market, but we’ll get to that later.

For now, we will focus on the 8.1-billion-dollar global market for nuclear medicine, which happens to be packing a 13% compound annual growth rate.

If you have ever had a diagnostic scan, like a CT or PET scan, or radiation treatment for cancer, you have already benefited from these isotopes. Eighty percent of all diagnostic medical scans worldwide rely on molybdenum-99 (99Mo to its friends) or its child isotope, technetium-99m (99mTc).

ASP’s plants are modular, with a small footprint, and can be constructed faster and for significantly less capital than traditional isotope separation facilities.

As a result of this IPO, their first plant to manufacture Molybdenum isotopes (Mo-100) is expected to be commissioned in early 2023, with commercial production beginning in late 2023 or early 2024.

The plan after the first plant is to self-finance future plants. They are currently focused on Molybdenum due to the increasing demand for medical isotopes and the planned phase-out of nine out of 10 of the existing nuclear reactors.

Longer-term opportunities exist in the enrichment of Silicon-28, Lithium-6, Oxygen-18, Zinc-68, Xenon-136, and Ytterbium-176. If you aren’t a physicist, this probably doesn’t mean much.

What is important to understand is that this technology has many applications and that while they will produce less material than a traditional isotope separation plant, they will be producing at much higher margins.

Catalyst: Demand & Geopolitical Pressure

Global demand for radioisotopes is growing, especially in China and India, where modern medical technology use is reaching the new middle class.

The U.S. is currently dependent on Russia for 31 radioisotope supply chains, and as of July this year, 19 of those had already experienced disruption.

The real blue sky here is the future technologies in development that will need isotopes.

With souring relations with Russia and the planned closure of nine out of 10 aging research reactors in the next eight to 10 years, the U.S. Department of Energy has acknowledged the supply issue, and legislation is being worked on that will provide government support to this industry. It is my assumption that ASP will attempt to benefit from some of this funding.

Blue Sky Rabbit Holes

If you know me or my picks, you will know that I like a solid business case with a lot of built-in blue skies. For ASP Isotopes, the Mo99 business will more than make the numbers work if they execute their business plan.

The real blue sky here is the future technology in development that will need isotopes. My three favorite possibilities are the use of Silicon-28 for quantum computing, U-235 and Lithium-6 for small modular reactors, and of course, Chlorine-37 for molten salt reactors for safe energy storage.

Any one of these three technologies could revolutionize this world. Quantum computing alone, with an expected 1000x increase in computation power, would unlock knowledge at unprecedented rates for humanity. It is being held back by, guess what, a bad isotope. Si-29 currently causes decoherence of qubits, and Si-28, with a 60% higher thermal conductivity, will lessen this problem and can be applied to solar cells and fiber optics. ASP can produce Si-28 enriched to 99.9%

There is almost nothing in the market that makes a good comparison to $ASPI.

Small modular reactors are all the craze in the nuclear energy world. These can be produced in a factory with greater safety, efficiency, and the ability to bring power supplies to isolated areas.

This is likely the future of nuclear and the US DOE has committed billions to the Advanced Reactor Design Program (ARDP).

Molten Salt Reactors (MSRs) are in development with several companies, and if successful, the technology will give us a much cleaner alternative to lithium batteries. Think grid-connected battery farms to stabilize the power grid and expand clean energy storage. These MSRs rely on liquid salt or fluoride and, of course, chlorine-37.

Ownership and Share Structure

I already own shares in $ASPI from before their IPO (I am always on the lookout for new deals and asymmetric trades, wink, wink). The IPO transaction is expected to price at $4, giving them a market cap of $120 million.

Who knows what will happen at the opening?

I expect it to begin trading today or tomorrow. The date will be subject to approval by the SEC, as always. With about 32 million shares total, the actual trading float should be in the neighborhood of 3.5 million shares, which is very tight for a Nasdaq-listed company.

Revenue Expectations

When it comes to listing on the Nasdaq, companies cannot put out forward-looking statements, so I had to hunt around to see what they had expected before deciding to list. So, know that these statements are what I believe to be accurate, but since the company cannot legally speak to them in a quiet period, it is the best I can provide.

ASP Isotopes had said before that they had signed a letter of intent for five times the productive capacity of the first plant. That would be 20 million in revenue and 16m in gross profit. They have stated before that because of the large return on investment, they plan on reinvesting proceeds into additional capacity. I expect to see them build several new plants in the next five years.

There is almost nothing in the market that makes a good comparison to $ASPI, I was able to find International Isotopes (INIS), which currently has a trailing price-to-earnings ratio of 23, and China Isotope & Radiation Corporation (1763. HK) traded on the HKSE with a trailing P/E of 10.88. Like all things with new innovative technology and companies, there is little use in comparing the old with the new.

This is a pre-revenue company; read this as a speculative play.

While I never give investment advice and am not an investment advisor, I can tell you that my $ASPI shares are a part of my high-risk / high-reward portfolio. This is where I put companies that I feel have huge potential, but that still requires a lot out of management to make my dreams come true.

My total high-risk / high-reward portfolio makes up no more than 25% of total stock market investments and must be rebalanced a lot because there is a lot of volatility in it.

PennyQueen Disclosures

I have not and will not be compensated for this report in any way. I write reports on my favorite picks; this is meant to be educational and not investment advice, as I am not an investment advisor, just a mom on a mission to make the world better and make money along the way.

Disclosures

1) PennyQueen: I, or members of my immediate household or family, own securities of the following companies mentioned in this article: ASP Isotopes. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: None.

2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. As of the date of this article, an affiliate of Streetwise Reports has a consulting relationship with: None. Please click here for more information.

4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.

5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of ASP Isotopes, a company mentioned in this article.

Energy Financial News

09 Nov

Crude Oil: 23 Years of Spot-on Forecasts You Can Fact-Check

For commodities like crude oil, supply and demand factors aren’t everything

By Elliott Wave International

Everyone who drives a car is relieved that gas prices have dropped from what they were a little while back.

However, if one major Wall Street firm is correct, get ready for higher prices at the pump again. This is a Nov. 1 headline from Markets Insider:

Tightening oil supply will drive crude oil prices to $115 a barrel by April, Goldman Sachs strategist says

Of course, higher crude oil prices mean higher gas prices and vice versa.

But does a “tightening oil supply” mean higher crude oil prices? Well, that’s certainly conventional wisdom, but as Elliott Wave International has observed over the decades, you cannot count on conventional wisdom.

Indeed, Chapter 22 of Robert Prechter’s landmark book, The Socionomic Theory of Finance, asks:

Do Supply and Demand Regulate Oil Prices?

He goes on to answer that question by saying:

The correct answer is … no, they don’t. In this chapter, I support my conclusion and demonstrate its value.

In a nutshell, Elliott waves regulate the trend of oil prices and the successful calls Elliott Wave International analysts have made over the years offer strong evidence for this.

Keep in mind that as you look at this chart from the book, it took Robert Prechter 43 pages to go into the details of how Elliott wave analysis called every major price turn in crude from 1993 into 2016:

Indeed, the very title of the chart says it all:

Elliott Wave Analysis Forecasted And / Or Recognized In Real Time All Of These Waves And Their Turning Points

Keep in mind that no method of analysis offers guarantees, yet — looking at what’s going on now — the October Global Market Perspective, a monthly Elliott Wave International publication which covers 50-plus worldwide financial markets, noted:

Crude extended its string of lower lows and lower highs in September as anticipated.

The October Global Market Perspective goes on to provide a forecast for crude oil.

Looping back to that crude oil price target by the major Wall Street firm, that price may at some point be hit. The point is that it’s best to consult the Elliott wave model rather than basing a crude oil prediction on supply and demand.

If you’d like to learn about Elliott wave analysis, or need a refresher, an excellent resource is Frost & Prechter’s book, Elliott Wave Principle: Key to Market Behavior. Here’s a quote from this Wall Street classic:

After you have acquired an Elliott “touch,” it will be forever with you, just as a child who learns to ride a bicycle never forgets. Thereafter, catching a turn becomes a fairly common experience and not really too difficult. Furthermore, by giving you a feeling of confidence as to where you are in the progress of the market, a knowledge of Elliott can prepare you psychologically for the fluctuating nature of price movement and free you from sharing the widely practiced analytical error of forever projecting today’s trends linearly into the future. Most important, the Wave Principle often indicates in advance the relative magnitude of the next period of market progress or regress. Living in harmony with those trends can make the difference between success and failure in financial affairs.

Would you like to read the entire online version of Elliott Wave Principle: Key to Market Behavior? If so, you may do so for free once you become a member of Club EWI, the world’s largest Elliott wave educational community.

A Club EWI membership is also free and opens the door to complimentary access to a wealth of Elliott wave resources on investing and trading, including videos and articles from Elliott Wave International analysts.

You can have the book on your screen in moments as you follow this link: Elliott Wave Principle: Key to Market Behavior.

This article was syndicated by Elliott Wave International and was originally published under the headline Crude Oil: 23 Years of Spot-on Forecasts You Can Fact-Check. EWI is the world’s largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.

Energy Financial News

07 Nov

Crude Oil Grew Confidently

By RoboForex Analytical Department

The commodity market efficiently reflected the improvement of the general situation. A Brent barrel on Monday is stabilising near 97.60 USD.

The main trigger for buying became an unexpected improvement in the forecasts on the global recession, which is a positive factor for the crude oil sector; also, there is a possibility that China will give up the zero tolerance regime in fighting with the coronavirus.

If these forecasts come true somehow, the commodity market will get serious support.

However, there are too few real reasons for softening the quarantine measures in China, and this understanding make commodity markets correct on Monday.

On H4, Brent has completed a wave of growth to 100.00. Today the market is forming a consolidation range under this level. Next, we expect a link of correction to 96.00. After it is over, a new wave of growth to 104.30 should start. The goal is local. Technically, this scenario is confirmed by the MACD. Its signal line is above zero in the histogram area, aimed strictly upwards.

On H1, Brent has formed a consolidation range around 96.50. With an escape upwards, the market has reached the goal of 100.00. This whole wave of growth is interpreted as the third one by the trend. Then we expect a link of correcting decline to 96.50. When this correction is over, another wave of growth to 100.00 should start. And when this level is broken away, a pathway for growth to 104.30 will open. Technically, this scenario is confirmed by the Stochastic oscillator. Its signal line is under 50. Further decline to 20 is expected.

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

Energy Financial News

01 Nov

Oil declines amid rising US production. RBA raises interest rate by 0.25%

By JustMarkets

The US indices fell yesterday amid weakness in the technology sector and ahead of a US Federal Reserve meeting, where a 0.75% interest rate hike is expected. At Monday’s close, the Dow Jones Index (US30) decreased by 0.39%, while the S&P500 Index (US500) lost 0.75%. The technology index NASDAQ (US100) dropped on Monday by 1.03%.

Nevertheless, experts believe the dollar’s gains could be limited if the Fed signals on Wednesday that the pace of rate hikes will slow down as it assesses the impact of its policy tightening. At the December meeting, federal funds futures forecast a 55% chance of a 50 basis point rate hike, down from 67% chance last Friday.

Famous companies reporting today are Pfizer (PFE), Toyota Motor (TM), AMD (AMD), BP (BP), Uber Tech (UBER), AIG (AIG), and Electronic Arts (EA).

Equity markets in Europe traded without a single dynamic yesterday. German DAX (DE30) gained 0.08%, French CAC 40 (FR40) dropped 0.10%, Spanish IBEX 35 (ES35) jumped by 0.51%, and British FTSE 100 (UK100) closed on Monday with a 0.66% gain.

Eurozone GDP grew slightly better than expected by 0.2% in the third quarter, indicating a clear slowdown from the 0.8% growth in the second quarter. Germany and Italy beat expectations, growing 0.3% Q/Q and 0.5% Q/Q, respectively, while Spain and France grew by 0.2% QoQ. The annualized Eurozone inflation rate reached 10.7%, against expectations of 10.3% growth. The core consumer price level, which excludes food and energy prices, rose to 5.0% from 4.8%. The purchasing managers’ composite index (PMI) showed a decline, with activity in all sectors gradually decreasing. Analysts believe a recession in the Eurozone is inevitable, and the next quarter will point to a significant drop in GDP.

German Chancellor Olaf Scholz promised a rapid introduction of natural gas price subsidies to mitigate the impact of skyrocketing energy prices. Germany, Europe’s largest economy, is at the center of an energy crisis engulfing the continent as Russia cuts gas supplies to the region and the country assembles a 200 billion euro emergency aid package. According to the Independent Natural Gas and Heating Commission, which presented its report Monday, about half of the money must be used to subsidize households and businesses.

Although Moscow has suspended its participation in a UN program to secure ships carrying grain from Ukraine amid the ongoing war, Ukrainian President Vladimir Zelensky said his country would continue a program brokered by the UN and Turkey in July to ensure an uninterrupted supply of food products to world markets.

The US is increasing its oil production, which puts downward pressure on oil quotes. Monthly government data showed that US oil production rose to nearly 12 million BPD in August, the highest since the COVID-19 pandemic. The coronavirus outbreak in China is expanding and starting to affect other cities, dampening hopes for a recovery in oil demand.

Asian markets traded flat yesterday. Japan’s Nikkei 225 (JP225) gained 1.78%, Hong Kong’s Hang Seng (HK50) ended the day down by 1.18%, and Australia’s S&P/ASX 200 (AU200) increased by 1.15%.

The Reserve Bank of Australia (RBA) raised its target interest rate by 25 basis points (BPS) to 2.85%, bringing interest rates to their highest level in 9 years. The Central Bank pledged to continue raising interest rates as necessary and will continue its data-driven approach. The RBA raised its inflation forecast for the year to 8% from 7.75%. Also, Australia’s GDP is now expected to grow by 3% in 2022, down from the previous forecast of 3.25%.

S&P 500 (F) (US500) 3,871.98 −29.08 (−0.75%)

Dow Jones (US30) 32,732.95 −128.85 (−0.39%)

DAX (DE40) 13,253.74 +10.41 (+0.079%)

FTSE 100 (UK100) 7,094.53 +46.86 (+0.66%)

USD Index 111.58 +0.83 (+0.75%)

Important events for today:

– Japan Manufacturing PMI (m/m) at 02:30 (GMT+2);
– Australia RBA Interest Rate Decision (m/m) at 05:30 (GMT+2);
– Australia RBA Rate Statement (m/m) at 05:30 (GMT+2);
– Australia RBA Governor Lowe Speaks (m/m) at 10:20 (GMT+2);
– UK Manufacturing PMI (m/m) at 11:30 (GMT+2);
– Canada Manufacturing PMI (m/m) at 15:30 (GMT+2);
– US ISM Manufacturing PMI (m/m) at 16:00 (GMT+2);
– US JOLTs Job Openings (m/m) at 16:00 (GMT+2);
– New Zealand RBNZ Financial Stability Report at 22:00 (GMT+2);
– New Zealand Unemployment Rate at 23:45 (GMT+2).

By JustMarkets

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

Energy Financial News

26 Oct

Europe’s Energy Sector: “The Lehman Moment Just Arrived”

This company’s stock price “broke a support shelf that dates back 14 years”

By Elliott Wave International

Back in October 2021, two months before Germany’s DAX hit an all-time high, our Global Market Perspective showed a big jump in references to “Lehman” in Bloomberg News.

Of course, the use of “Lehman” in a news article has become synonymous with the collapse of the then financial giant during the depths of the 2007-2009 financial crisis.

The October 2021 Global Market Perspective, an Elliott Wave International monthly publication which covers 50-plus worldwide financial markets, said:

The Lehman moment will come later, after investor optimism has receded and stock prices are well off their highs.

That was a year ago, and since then, Europe’s key stock indexes have been in a downward trend. In other words, investor optimism across the Continent has indeed receded.

The October 2022 Global Market Perspective noted:

Right on schedule, the Lehman moment just arrived at one of the Continent’s most critical sectors: “Europe’s Lehman Warning on Energy Prompts Flurry of Cash Aid” — Bloomberg, 9/6/22.

The October Global Market Perspective continued with these charts and commentary:

The chart shows stock prices at two of Europe’s utility behemoths. Centrica, the largest supplier of gas to domestic customers in the UK, trades at levels last seen in the 1990s, while Fortum Oyj, Finland’s largest company by revenue, dropped 68% over the past nine months and broke a support shelf that dates back 14 years.

… The Finnish government stepped in with a €2.4 billion bridge loan to Fortum, while Centrica is seeking billions of pounds of financing amidst soaring demands for collateral.

Then there is this chart of Uniper, the European gas giant sitting at the epicenter of the energy earthquake. On September 20, the German government forked over 8 billion “to nationalize the gas giant and stave off a collapse of the country’s energy sector.” (Bloomberg, 9/20/22)

Stave off a collapse? The chart shows that Uniper has already collapsed despite every effort.

Some of Europe’s energy sector firms face the same kind of liquidity problem which wrecked established investment banks a decade ago. Uniper was reportedly losing €100 million per day in early September, and Fortum’s collateral requirement jumped by €1 billion over one single week.

Getting back to the downtrend in major European stock indexes, the Elliott wave method for analyzing financial markets can help you determine if the decline in prices is nearly over or if there’s much more to go.

If you need to brush up on your Elliott wave knowledge, or are entirely new to the subject, an ideal resource is Frost & Prechter’s Wall Street classic book, Elliott Wave Principle: Key to Market Behavior. Here’s a quote:

[R.N.] Elliott himself never speculated on why the market’s essential form is five waves to progress and three waves to regress. He simply noted that that was what was happening. Does the essential form have to be five waves and three waves? Think about it and you will realize that this is the minimum requirement for, and therefore the most efficient method of, achieving both fluctuation and progress in linear movement. One wave does not allow fluctuation. The fewest subdivisions to create fluctuation is three waves. Three waves (of unqualified size) in both directions would not allow progress. To progress in one direction despite periods of regress, movements in that direction must be at least five waves, simply to cover more ground than the intervening three waves. While there could be more waves than that, the most efficient form of punctuated progress is 5-3, and nature typically follows the most efficient path.

If you’d like to read the entire online version of the book, you may do so for free once you become a member of Club EWI, the world’s largest Elliott wave educational community (about 500,000 worldwide members and growing rapidly).

A Club EWI membership is also free and allows you complimentary access to a wealth of Elliott wave resources. All the while, you are under no obligation.

Get started by following this link: Elliott Wave Principle: Key to Market Behavior — free and instant access.

This article was syndicated by Elliott Wave International and was originally published under the headline Europe’s Energy Sector: “The Lehman Moment Just Arrived”. EWI is the world’s largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.

Energy Financial News

18 Oct

Third-Party Firm Rates Hydrogen Boiler Nearly 100% Efficient

Source: Streetwise Reports (10/17/22)

Jericho Energy Ventures is working to bring its zero-emission hydrogen boilers to companies for commercial heating, hot water, and industrial steam.

An independent third-party firm has rated Jericho Energy Ventures Inc.’s (JEV:TSX.V; JROOF:OTCMKTS) zero-emissions hydrogen boiler technology as nearly 100% fuel efficient.

The company’s Dynamic Combustion Chamber™ boiler was tested by Process Engineering Associates LLC.

“All off-gas samples taken during the test did not detect hydrogen in the sample,” said Chris Muntean, a senior process engineer with Process Engineering Associates. “This data suggests that the burners are combusting the vast majority (or all) of the H2 (hydrogen) gas being supplied to the boiler. Based on these performance results, little to no fuel is left unburned.”

As technical analyst Clive Maund wrote for Streetwise Reports, hydrogen “is a fuel of the future.”

As companies shift toward greener energy sources and look to lower their carbon footprint, Jericho hopes its boiler technology will be there for commercial heating, hot water, and industrial steam boilers.

Hydrogen Technologies, a fully owned subsidiary of Jericho, has patented its method for burning hydrogen and oxygen in a vacuum chamber to create high-temperature water and steam with no greenhouse gases or other pollutants.

The only by-product is water, which is recycled. It’s meant to replace existing boilers that burn coal, natural gas, diesel, or fuel oil.

“Our system is more efficient than traditional steam systems,” Jericho Executive Officer Brian Williamson told Streetwise Reports. “They did a whole battery of tests on our system and validated that it is, in fact, 95% cost-efficient, which is . . . 20% plus more efficient than anything else that’s out there in the market in conventional fossil fuels. There’s also 100% hydrogen burn in the system, meaning that there’s no waste.”

The Catalyst

The test backs up Jericho’s own research on the technology, and the company hopes to use the data to attract investors and customers.

Hydrogen Technologies held a demo week at the end of September in Modesto, Calif., for possible commercial and industrial clients. The company said it was so successful it plans to hold another demo week November 14-18.

The U.S. Department of Energy said the hydrogen market “is in its infancy” but that it has the “potential for near-zero greenhouse gas emissions.”

“Hydrogen generates electrical power in a fuel cell, emitting only water vapor and warm air,” the agency wrote. “It holds promise for growth in both the stationary and transportation energy sectors.”

The element is abundant in our environment and the most abundant element in the universe. It’s stored in water, hydrocarbons (such as methane), and other organic matter.

As technical analyst Clive Maund wrote for Streetwise Reports, hydrogen “is a fuel of the future.”

‘Quite a Few’ Companies Interested

Last summer, Jericho announced it was joining with Australia’s LINE Hydrogen Pty Ltd. to bring the boilers to that country. The companies are creating a distribution “hub” that will allow a constant supply of hydrogen fuel.

Jericho said additional industrial partners will be announced in the coming months, and the first DCC™ boiler is expected to be installed in Tasmania, Australia, in 2023.

Williamson said Jericho has “quite a few” companies that have already expressed interest in the boiler system. Jericho said it will target everything from large industrial plants to schools and hopes to create other duplicate hubs in other places in the world, like the United States, Canada, and Europe.

Each boiler removes the equivalent carbon dioxide of 2,500 cars a year (or about 4,400 tons of carbon dioxide), according to the company.

Jericho was once an oil and gas business. It still has interests in those sectors and has been using money from rising fossil fuel prices to help fund its push toward hydrogen.

The company began transitioning to green energy in June 2020. In January 2021, it announced the acquisition of Hydrogen Technologies. Also, last year, it announced a collaboration with Rémy Cointreau’s Bruichladdich Distillery in Scotland to install a boiler to run its stills that produce Scotch and artisanal gin.

Other green investments include in H2U Technologies Inc., which is developing an electrocatalyst discovery process for electrolyzer and fuel cell applications, and Supercritical Solutions Ltd., which is developing a new class of water electrolyzer that will allow low-cost hydrogen production. Jericho led the seed series funding round for SuperCritical and was joined by Chris Sacca’s Lowercarbon Capital as a co-investor.

Ownership and Share Structure

Top shareholders include Michael L. Graves Inter Vivos Trust with 16.43% or 37.13 million shares, McKenna & Associates LLC with 10.78% or 24.36 million shares, the CEO Williamson with 0.87% or 1.97 million shares, company Director Allen Wilson with 0.87% or 1.97 million shares, and Nicholas W. Baxter with 0.5% or 1.14 million shares.

Jericho has a market cap of CA$81.38 million with 226 million shares outstanding, 158.3 million of them free-floating. It trades in a 52-week range of CA$0.84 and CA$0.31.

Disclosures:
1) Steve Sobek wrote this article for Streetwise Reports LLC. He or members of his household own securities of the following companies mentioned in the article: None. He or members of his household are paid by the following companies mentioned in this article: None.

2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: Jericho Energy Ventures. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.

3) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.

4) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Jericho Energy Ventures, a company mentioned in this article.

Energy Financial News

17 Oct

Crude Oil has Squandered All of Its Gains

By RoboForex Analytical Department

The commodities market starts the new week in October with attempts to stabilise. The Brent barrel had previously “sagged”, but is now returning to USD 92.40. It turns out that the entire positive effect of the OPEC+ decision to reduce black gold production quotas for November has now been exhausted.

This week, however, the focus of the commodities market will be on economic data from China. The main thing investors will be interested in is GDP figures for Q3, where a 3.5% y/y increase is expected, as well as figures for industrial production and retail sales. Forecasts look very weak due to the ongoing coronavirus restrictions.

Fresh data from Baker Hughes reflected an increase of 8 rigs in the US for the week up to 610. Oil production in the country stands at 12 million bpd, IEA expects to rise to 12.3 million bpd by end-December.

On the H4 Brent chart, an upside wave to 95.40 and a correction to 91.50 have been worked out. Today the market has started to form another upside wave to the level of 95.66. We expect its break up and continuation of the trend towards 99.55. The target is local. After it is reached, we will consider the probability of correction to the level of 95.66. Further – growth to 105,50. Technically, this scenario is confirmed by the MACD oscillator. Its signal line is above the zero mark and it is ready to continue growth to new highs.

On the H1 Brent chart, the corrective wave channel has been broken upwards and quotations are trading in a rising structure towards the 95.66 level. The target in the next growth wave is the first one. After it is broken down, a correction link to 93.85 is not ruled out. Further – growth to the level of 97.00 with the prospect of trend continuation to 99.55. The target is local. Technically, this scenario is also confirmed by theStochastic oscillator. Its signal line is above the 50 mark. We expect the continuation of growth towards 80.

Disclaimer

Energy Financial News

15 Oct

Weekly Energy Speculator Changes led by WTI Crude Oil and Heating Oil

By InvestMacro

Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC).

The latest COT data is updated through Tuesday October 11th and shows a quick view of how large traders (for-profit speculators and commercial hedgers) were positioned in the futures markets.

Weekly Speculator Changes led by WTI Crude Oil and Heating Oil

COT energy market speculator bets were mixed this week as three out of the six energy markets we cover had higher positioning this week while the other three markets had lower contracts.

Leading the gains for energy markets was WTI Crude Oil (17,221 contracts) with Heating Oil (3,668 contracts) and Bloomberg Commodity Index (176 contracts) also showing positive weeks.

The energy markets leading the declines in speculator bets this week were Gasoline (-4,974 contracts) with Natural Gas (-3,007 contracts) and Brent Crude Oil (-2,068 contracts) also registering lower bets on the week.

Data Snapshot of Commodity Market Traders | Columns Legend

Oct-11-2022	OI	OI-Index	Spec-Net	Spec-Index	Com-Net	COM-Index	Smalls-Net	Smalls-Index
WTI Crude	1,499,498	3	259,220	13	-283,626	88	24,406	41
Gold	431,395	0	94,420	14	-103,728	87	9,308	3
Silver	125,623	0	7,389	22	-15,603	80	8,214	10
Copper	167,449	8	-15,899	24	16,903	80	-1,004	19
Palladium	6,890	5	-754	19	810	79	-56	41
Platinum	52,435	9	5,928	17	-8,690	85	2,762	5
Natural Gas	974,468	5	-162,103	30	130,099	72	32,004	56
Brent	163,113	11	-41,888	41	38,882	58	3,006	50
Heating Oil	275,262	25	19,423	71	-38,448	30	19,025	64
Soybeans	694,960	26	55,769	30	-30,614	77	-25,155	29
Corn	1,408,939	20	325,121	72	-258,225	35	-66,896	5
Coffee	188,198	3	40,534	73	-43,359	30	2,825	29
Sugar	687,209	0	101,115	57	-135,145	43	34,030	50
Wheat	307,901	9	-1,990	16	8,705	72	-6,715	76

Strength Scores led by Bloomberg Commodity Index & Heating Oil

Strength Scores (a normalized measure of Speculator positions over a 3-Year range, from 0 to 100 where above 80 is extreme bullish and below 20 is extreme bearish) show that the Bloomberg Commodity Index (78.3 percent) and Heating Oil (71.0 percent) lead the energy markets with scores above 50 percent.

On the downside, WTI Crude Oil (12.8 percent) and Gasoline (15.3 percent) come in at the lowest strength level currently and both are in extreme bearish levels (below 20 percent).

Strength Statistics:
WTI Crude Oil (12.8 percent) vs WTI Crude Oil previous week (8.3 percent)
Brent Crude Oil (40.9 percent) vs Brent Crude Oil previous week (44.4 percent)
Natural Gas (29.9 percent) vs Natural Gas previous week (30.8 percent)
Gasoline (15.3 percent) vs Gasoline previous week (20.3 percent)
Heating Oil (71.0 percent) vs Heating Oil previous week (65.6 percent)
Bloomberg Commodity Index (78.3 percent) vs Bloomberg Commodity Index previous week (77.6 percent)

Bloomberg Commodity Index leads the 6-Week Strength Trends

Strength Score Trends (or move index, calculates the 6-week changes in strength scores) show that the Bloomberg Commodity Index (18.9 percent) leads the past six weeks trends for energy this week. WTI Crude Oil (7.9 percent) is the only other positive mover in the latest trends data.

Natural Gas (-10.0 percent) leads the downside trend scores currently while the next markets with lower trend scores were Heating Oil (-8.5 percent) followed by Gasoline (-6.4 percent).

Strength Trend Statistics:
WTI Crude Oil (7.9 percent) vs WTI Crude Oil previous week (-1.1 percent)
Brent Crude Oil (-3.2 percent) vs Brent Crude Oil previous week (-5.7 percent)
Natural Gas (-10.0 percent) vs Natural Gas previous week (-9.2 percent)
Gasoline (-6.4 percent) vs Gasoline previous week (-4.5 percent)
Heating Oil (-8.5 percent) vs Heating Oil previous week (-8.9 percent)
Bloomberg Commodity Index (18.9 percent) vs Bloomberg Commodity Index previous week (18.6 percent)

Individual COT Energy Market Charts:

WTI Crude Oil Futures:

The WTI Crude Oil Futures large speculator standing this week resulted in a net position of 259,220 contracts in the data reported through Tuesday. This was a weekly rise of 17,221 contracts from the previous week which had a total of 241,999 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 12.8 percent. The commercials are Bullish-Extreme with a score of 87.7 percent and the small traders (not shown in chart) are Bearish with a score of 40.7 percent.

WTI Crude Oil Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	23.0	39.0	5.1
– Percent of Open Interest Shorts:	5.7	57.9	3.5
– Net Position:	259,220	-283,626	24,406
– Gross Longs:	345,258	584,609	76,359
– Gross Shorts:	86,038	868,235	51,953
– Long to Short Ratio:	4.0 to 1	0.7 to 1	1.5 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	12.8	87.7	40.7
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	7.9	-7.4	-4.4

Brent Crude Oil Futures:

The Brent Crude Oil Futures large speculator standing this week resulted in a net position of -41,888 contracts in the data reported through Tuesday. This was a weekly decline of -2,068 contracts from the previous week which had a total of -39,820 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 40.9 percent. The commercials are Bullish with a score of 57.9 percent and the small traders (not shown in chart) are Bearish with a score of 49.9 percent.

Brent Crude Oil Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	17.5	51.4	4.9
– Percent of Open Interest Shorts:	43.2	27.6	3.1
– Net Position:	-41,888	38,882	3,006
– Gross Longs:	28,606	83,836	7,999
– Gross Shorts:	70,494	44,954	4,993
– Long to Short Ratio:	0.4 to 1	1.9 to 1	1.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	40.9	57.9	49.9
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-3.2	3.8	-5.7

Natural Gas Futures:

The Natural Gas Futures large speculator standing this week resulted in a net position of -162,103 contracts in the data reported through Tuesday. This was a weekly reduction of -3,007 contracts from the previous week which had a total of -159,096 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 29.9 percent. The commercials are Bullish with a score of 71.9 percent and the small traders (not shown in chart) are Bullish with a score of 56.0 percent.

Natural Gas Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	14.5	44.4	6.8
– Percent of Open Interest Shorts:	31.1	31.0	3.5
– Net Position:	-162,103	130,099	32,004
– Gross Longs:	140,917	432,665	65,929
– Gross Shorts:	303,020	302,566	33,925
– Long to Short Ratio:	0.5 to 1	1.4 to 1	1.9 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	29.9	71.9	56.0
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-10.0	11.9	-10.1

Gasoline Blendstock Futures:

The Gasoline Blendstock Futures large speculator standing this week resulted in a net position of 43,282 contracts in the data reported through Tuesday. This was a weekly decrease of -4,974 contracts from the previous week which had a total of 48,256 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 15.3 percent. The commercials are Bullish-Extreme with a score of 84.7 percent and the small traders (not shown in chart) are Bearish with a score of 48.5 percent.

Nasdaq Mini Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	28.6	53.0	7.7
– Percent of Open Interest Shorts:	11.8	71.9	5.6
– Net Position:	43,282	-48,643	5,361
– Gross Longs:	73,663	136,457	19,739
– Gross Shorts:	30,381	185,100	14,378
– Long to Short Ratio:	2.4 to 1	0.7 to 1	1.4 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	15.3	84.7	48.5
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-6.4	4.6	10.8

#2 Heating Oil NY-Harbor Futures:

The #2 Heating Oil NY-Harbor Futures large speculator standing this week resulted in a net position of 19,423 contracts in the data reported through Tuesday. This was a weekly rise of 3,668 contracts from the previous week which had a total of 15,755 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 71.0 percent. The commercials are Bearish with a score of 30.3 percent and the small traders (not shown in chart) are Bullish with a score of 64.3 percent.

Heating Oil Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	15.1	48.4	16.5
– Percent of Open Interest Shorts:	8.1	62.4	9.6
– Net Position:	19,423	-38,448	19,025
– Gross Longs:	41,620	133,301	45,373
– Gross Shorts:	22,197	171,749	26,348
– Long to Short Ratio:	1.9 to 1	0.8 to 1	1.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	71.0	30.3	64.3
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-8.5	5.7	1.6

Bloomberg Commodity Index Futures:

The Bloomberg Commodity Index Futures large speculator standing this week resulted in a net position of -7,623 contracts in the data reported through Tuesday. This was a weekly gain of 176 contracts from the previous week which had a total of -7,799 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 78.3 percent. The commercials are Bearish with a score of 22.0 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 15.5 percent.

Bloomberg Index Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	19.6	76.4	0.4
– Percent of Open Interest Shorts:	32.5	63.8	0.2
– Net Position:	-7,623	7,468	155
– Gross Longs:	11,559	45,105	253
– Gross Shorts:	19,182	37,637	98
– Long to Short Ratio:	0.6 to 1	1.2 to 1	2.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	78.3	22.0	15.5
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	18.9	-18.4	-6.8

Article By InvestMacro – Receive our weekly COT Newsletter

*COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets.

The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators) as well as their open interest (contracts open in the market at time of reporting). See CFTC criteria here.

COT Updates Energy Financial News investing

13 Oct

Oil bulls try to make a comeback

By ForexTime

The Crude Oil market on the D1 time frame was in an extended down trend until 26 September when a last lower bottom was recorded at 76.13. Bulls found the price attractive at those levels and demand started overcoming supply.

A closer look at the Momentum Oscillator reveals a positive divergence between points “a” and “b” when comparing the bottoms at 83.74 and 76.13. This could have alerted technical traders that the downtrend might be losing momentum.

After the lower bottom at 76.13, the price of Crude Oil broke through the 15 and 34 Simple Moving Averages and the Momentum Oscillator cut through the 100 base-line into bullish territory.

A higher top and possible critical resistance level formed on 10 Oct at 92.59. Bears are currently trying to drive the price lower but a possible higher bottom might be forming at a support level on 12 October at 85.17.

If the support level holds and the bulls manage to break through the critical resistance level at 92.59, then three possible price targets can be calculated from there. Applying the Fibonacci tool to the higher top at 92.59 and dragging it to the bottom of the support area at 85.17, the following targets may be considered. The first target may be likely at 97.18 (161%) and the second price target at 104.60 (261.8%). The third and final target may be expected at 116.60 (423.6%).

If the support level at 85.17 is broken, the bullish scenario is overturned and the scenario needs to be re-assessed.

As long as the supply remains constrained, the outlook for the Crude Oil market in the D1 time frame will remain bullish.

Article by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Energy Financial News

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