Top 3 Things to Watch into the Energy Close

• December crude at $101.40: A settlement back above it would restore last week’s breakout and could open $102.82, then $103.90. A settlement below the channel edge near $99.70 would put price back inside the channel and could open $98.84.
• Inventories and the Fed: Confirmation of another crude draw alongside a steady Fed could carry December through $102.24. A disappointing inventory number could send it back toward $99.75.
• December nat gas at $3.10: As long as it settles below the prior contract low, rallies may keep running into sellers, with $2.93 the next test. A settlement above $3.16 would show the selling has slowed and could open $3.24.

Energy Cross Asset Note

 Crude is rebounding after two days of selling as the risk of renewed US strikes on Iran comes back into focus. Washington has reportedly told several Gulf allies to prepare for a short, intense campaign after next week’s midterms. The president is said to be leaning toward a large post-election strike but hasn’t committed, and a third carrier group is moving toward the region. Diplomacy is still running alongside: Qatari mediators reportedly gave Iran a new draft deal over the weekend, and Iran’s supreme leader restated his conditions for ending the war. Israel’s election is unresolved, with neither bloc holding a clear path to a majority, which raises the possibility of another vote. A fire near Ras Tanura, Saudi Arabia’s largest export terminal, was contained Tuesday, though the damage isn’t yet clear. Brent has nearly doubled this year, but futures keep climbing while the physical market shows signs of softness, and India and China are both expected to ease diesel tightness next year. Today brings official US inventory data, with an industry estimate pointing to a 2 million barrel crude draw, along with the Fed decision, where rates are expected to hold. In nat gas, the expiring November contract jumped 3.7% Tuesday as flows to the Freeport LNG terminal recovered from a power outage and shorts covered ahead of expiration. December lagged as funds rolled their short positions forward rather than closing them. Forecasts turned colder across the South, though the East still runs above normal through November 10. Production is up more than 5% on the year while demand is running nearly 5% lower. Asian LNG is near a four-year high, and Thursday brings the next storage report. For clients, crude has spent the week swinging between strike reports and deal headlines, and holding the channel through that is constructive, though position size still matters with the election and the Fed both in play. In nat gas, funds are rolling their shorts rather than covering them, which says the bearish bet is still on and keeps any bounce in December working into resistance until a settlement says otherwise.

Crude Oil - The Setup

Crude Oil - The Technicals

CRUDE OIL 

Current Price: December WTI (CLEZ26) $101.47, up $1.56 (1.56%) | Session high $102.24, low $99.75

Chart Setup
Tuesday faded $1.86 to settle at $99.90. That gave up the $101.40 breakout point but held the upper edge of the rising channel near $99.70. This morning’s dip to $99.75 tested that edge again, and buyers lifted price back to $101.47, just above the old breakout point. So far the channel edge has held on every settlement since Friday’s breakout, but the move needs to get back above $101.40 to keep the breakout working. December sits about $6.60 above the rising 20 day at $94.87, with the 50 day at $90.27.

Key Levels Above

• $103.90 (Friday’s high, high of the move)
• $103.27 (Friday settle)
• $102.82 (Tuesday high)
• $102.24 (today’s high)
• $101.76 (Monday settle)

Current Price: $101.47

Key Levels Below

• $101.40 (breakout point, April front-month high)
• $100.60 (Monday low)
• $99.90 (Tuesday settle)
• $99.75 (today’s low, with the channel edge near $99.70)
• $98.84 (last Friday’s low)
• Bias
  The upper edge of the channel near $99.70 is the level to manage against. As long as December settles above it, the breakout is bent but not broken. A settlement back above $101.40 would restore it and opens $102.82, then the $103.27 to $103.90 area. A settlement below $99.70 would put price back inside the channel, mark the breakout as failed, and opens $98.84. For sidelined traders, a pullback toward $99.90 to $100.60 offers defined risk with a stop under the channel edge. Chasing above $102 into a heavy event day gives up that edge.

Seasonal Tendencies Update

(Updated on 10.26.26)

Below is a look at historical price averages for December Crude Oil futures on a 5, 10, 15, 20, and 30-year time frames over a 6-month time frame (Past performance is not necessarily indicative of future results). Red = 5y, Green = 10y, Blue = 15y, Yellow = 20y, Violet = 30y 

Natural Gas - The Setup

Natural Gas - The Technicals

NATURAL GAS 

Current Price: December Natural Gas (NGEZ26) $3.05, up $0.05 (1.50%) | Session high $3.08, low $3.04

Chart Setup
December set its contract low of $2.93 on Monday and is still trading within a few cents of it. Tuesday slipped 1.8 cents to settle at $3.00, even as the expiring November contract rallied, a sign that shorts are being rolled forward rather than covered. This morning’s push to $3.08 is a modest bounce off a fresh low, not a change in direction. All four averages remain overhead, with the 20 day at $3.33 below a falling 50 day at $3.42. The prior contract low at $3.10 and last Friday’s $3.16 high are the first resistance points above.

Key Levels Above

• $3.33 (20 day)
• $3.24 (early October low, broken last week)
• $3.16 (last Friday’s high)
• $3.10 (prior contract low)
• $3.08 (today’s high)

Current Price: $3.05

Key Levels Below

• $3.04 (today’s low)
• $3.00 (Tuesday settle)
• $2.96 (Tuesday low)
• $2.93 (Monday low, contract low)

Bias
The prior contract low at $3.10 is the level to manage against, now from below. As long as December settles under it, rallies are working into resistance in a market that hasn’t stopped trending lower. The $3.08 to $3.16 area may offer sellers a better entry than the lows, with risk defined above last Friday’s $3.16 high. A settlement above $3.16 would show the selling has slowed and opens $3.24. On the downside, a settlement back below $3.00 puts the $2.93 contract low back in play, and a break of that extends into new lows with nothing underneath. For sidelined traders, chasing this bounce from the long side is early.

Seasonal Tendencies Update

(Updated on 10.26.26)

Below is a look at historical price averages for December Natural Gas futures on a 5, 10, 15, 20, and 30-year time frames over a 6-month time frame  (Past performance is not necessarily indicative of future results). Red = 5y, Green = 10y, Blue = 15y, Yellow = 20y, Violet = 30y 

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Hypothetical performance results have many inherent limitations, some of which are described below. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown. In fact, there are frequently sharp differences between hypothetical performance results and the actual results subsequently achieved by any particular trading program.

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