Brent crude (QA) remains in a major (long-term) uptrend. The spot-month contract moved to a new 4-month high of $92.18 during April before faltering late in the month, closing at $86.33, down $0.67 from the March settlement. The market continues to consolidate within a series of higher lows and lower highs, with the outer range being $68.20 (May 2023) to $97.67 (September 2023). Theoretical Positions: Previous short futures were covered and new longs established as the spot-month contract took out the previous 4-month high of $87.49 during August 2023. This has longs at roughly $87.50. Additional longs could’ve been established near the January close of $80.55 based on the idea Wave 2 has bottomed. This puts the average long position at roughly $84.00. Sell stops would be below the 4-month low of $74.79 (January 2024) or $72.30 (December 2023).
WTI crude oil (CL) remains in a major uptrend. Similar to Brent, WTI continues to consolidate within a series of higher lows and lower highs. Theoretical Positions: Long positions were established on the move above the previous 4-month high of $83.53 (April 2023). Additional longs could’ve been established near the January 2024 close of $75.85 on the idea Wave 2 has bottomed. The average position would be near $79.70. Sell stops would be below the December 2023 low of $67.71.
Distillates (HO, heating oil, diesel fuel, jet fuel, etc.) remain in a major 5-wave uptrend, though like the crude oil markets, that pattern came into question late in April. The spot-month contract fell to a low of $2.4899, just above the December 2023 mark of $2.4838. Theoretical Positions: Traders could be long just above the previous 4-month high of $2.9198. Additionally, those needing to cover diesel needs might’ve done so near the January close of $2.7852 based on the idea Wave 2 has bottomed. Traders would likely have a sell stop below the December 2023 low of $2.4838.
RBOB gasoline (RB) extended its major uptrend to a high of $2.8516 during April before closing lower for the month. This looks to be a move into a Wave 2 selloff. Theoretical Positions: Traders likely established long futures positions above the previous 4-month high of $2.5810. If so, stops would be placed below the previous low of $1.9672 (December 2023).
Natural gas (NG) looks to be in a sideways trend at the low end of its recent major downtrend. Theoretical Positions: Realistically, there are no positions at this time. Traders could go long on a bullish breakout above $2.168, the high from February 2024.
