Upside for crude oil capped at Rs 7,700; Natural Gas faces hurdle at Rs 492

On the downside, the MCX Crude Oil futures have near support at Rs 7,205 and Rs 7,027 levels. Meanwhile, if Natural Gas futures sustain above Rs 492, they can rally past the Rs 535-level.

The overall price-to-moving averages action is negative for MCX Crude Oil futures, hence the upside seems capped around the 200-DMA. On the other hand, outlook for Natural Gas futures seems mixed, with the 200-DMA at Rs 492-level holding the key.

Crude Oil

Bias: Negative

Last close: Rs 7,318

Target: Rs 6,110

Support: Rs 7,205; Rs 7,025

Resistance: Rs 7,475; Rs 7,700

The MCX Crude Oil futures, since the breakdown in early July, seem to be struggling to sustain above the key moving averages. The overall price-to-moving averages action is also negative, as the long-term (200-DMA - Daily Moving Average) is fairly above the other shorter term moving averages on the daily scale.

For now, the MCX Crude Oil .. futures have pulled back above the 20-DMA, placed at Rs 7,205 after testing support around the 50-DMA at Rs 7,025-level. However, the upside seems to be capped around the 200-DMA placed at Rs 7,700, with interim resistance likely around the 100-DMA at Rs 7,475, and the higher-end of the Bollinger Band at Rs 7,575.

The medium-term trend on the weekly chart is on the verge of turning negative, with the 20-WMA (Weekly Moving Average) placed at Rs 7,381, seen dipping below the 50-WMA at Rs 7,326. The weekly chart, indicates a likely downside target of Rs 6,110 for Crude Oil futures.

On the contrary, in case, Crude Oil prices are able to break and sustain above Rs 7,381 on a consistent basis, a sharper pullback towards Rs 8,450 cannot be ruled out, hints the weekly chart.

The MCX Crude Oil November futures so far this week have exhibited high volatility. According to the weekly Fibonacci chart, the MCX Crude futures can seek support around Rs 7,025 - Rs 6,965 - Rs 6,905. On the upside, the MCX Crude Oil contract is likely to face resistance around Rs 7,400 - Rs 7,460 - Rs 7,520.

According to the daily Fibonacci chart, On Wednesday, the MCX Crude Oil November futures could trade in a range of Rs 7,175 to Rs 7,465, with support expected around Rs 7,265 - Rs 7,230 - Rs 7,200. On the upside, the Crude Oil futures could face resistance around Rs 7,370 - Rs 7,405 - Rs 7,435. 

Natural Gas

Bias: Neutral

Last close: Rs 472.80

Support: Rs 468; Rs 444

Resistance: Rs 492; Rs 535

The MCX Natural Gas November futures are seen testing resistance around the 200-DMA, which it broke last month after a gap of eight months. The 200-DMA currently stands at Rs 535.30.

As per the price-to-moving averages action, the overall trading sentiment seems a bit mixed for even as the 20-DMA has dipped below the key moving averages at Rs 495. The 50-DMA at Rs 581.90 and the 100-DMA at Rs 589.40, still stand firmly above the 200-DMA at Rs 535.30

Select key momentum oscillators on the daily chart like the 14-day RSI and the MACD are indicating a favourable move in the near term, hence the commodity may be able to take-off the 200-DMA. However, the upside may still be limited to the other key moving averages. 

According to the weekly Fibonacci chart, the bias for this week is likely to remain positive as long as the MCX Natural Gas November futures trade above Rs 468-level; below which the next significant support is at Rs 444. On the upside, the energy-based commodity contract needs to sustain above Rs 492-level for a renewed push beyond Rs 535.30.

On Wednesday, as per the daily Fibonacci chart, MCX Natural Gas futures may seek support around Rs 461.80 - Rs 453.70 - Rs 441.80, while on the upside the commodity contract is likely to face resistance around Rs 492 - Rs 497.90 - Rs 503.80.