Crude Tests the October Base After an 8% Drop as Nat Gas Faces a Storage Test
Barchart·11/05/2026 09:45:20
Listen to the news
Top 3 Things to Watch into the Energy Close
December crude at $88.90: A settlement back above the top of the October base would mark the zone as holding and could open the 50 day at $92.39. A settlement below $86.00 would mean the base gave way and could open the 100 day at $82.07.
The EIA storage report at 9:30 Central: The estimate is a 78 bcf build against a 61 bcf five-year average. A larger number could push December back under $2.90, while a smaller one could lift it through $3.00.
December nat gas at $2.94: A settlement above Monday’s high would keep Wednesday’s turn alive and could open the channel edge near $3.06. A settlement below $2.90 would erase the bounce and could put the $2.84 contract low back in play.
Energy Cross Asset Note
The midterms delivered the catalyst crude had been waiting on. Democrats won control of both chambers of Congress, and the market is reading that as a faster path to ending the war. Control of spending gives Congress more leverage over the conflict. The vice president said voter frustration over the war hurt Republicans, and the president said he has no immediate plans to escalate, while acknowledging the war played a role in the results. Brent is down almost 20% this week to near a two-month low, and WTI just posted its biggest one-day loss since May. Gulf exports running near prewar levels, despite ongoing tanker attacks, add to the pressure. Without concrete progress between Washington and Tehran, though, a decline this steep can reverse quickly. Fuel markets have not loosened. US distillate stocks fell below 100 million barrels, the lowest since 2003, and crude inventories fell for a fifth straight week. The oil sector is also bracing for a possible windfall tax under the new Congress. European gas fell as much as 5% on the same peace hopes. In US nat gas, a colder turn in forecasts and stronger LNG flows lifted December above Monday’s high. The supply side is working against that bounce, though. Production rebounded to about 112 bcf/day, back above last year, which undercuts this week’s production-cut story, and today’s storage build is expected to run above normal. Gas producer stocks fell on concerns the election could slow gas-fired power projects for data centers. Asian LNG slipped to $31 as major buyers hold back, and some developing economies are turning to solar to cut their reliance on imported LNG. For clients, crude has given back its October rally in two sessions and is now testing the base the move launched from. This is a spot to wait for the market to show its hand, not to chase. In nat gas, the first real bounce in weeks now faces a storage test this morning. Rallies remain the better place to sell.
Crude Oil - The Setup
Crude Oil - The Technicals
CRUDE OIL
Current Price: December WTI (CLEZ26) $88.74, up $0.62 (0.70%) | Session high $88.77, low $86.65
Chart Setup
December fell $7.97 Wednesday, or 8.3%, to settle at $88.12. That move broke the rising trendline from the August low and went straight through the 50 day. Overnight it pushed to $86.65, into the demand zone at $86.00 to $89.00 that marks the early-October base, then rebounded to the session high. Price is now testing the top of that zone at $88.90, right where the October rally began. December has dropped about $16 from last week’s $104.99 high, and the 20 day at $97.03 has rolled over.
Key Levels Above
$97.03 (20 day)
$95.50 (August trendline, broken Wednesday)
$92.90 (late-September break point)
$92.39 (50 day)
$88.90 (top of the early-October base)
Current Price: $88.74
Key Levels Below
$88.12 (Wednesday settle)
$86.65 (today’s low)
$86.00 (bottom of the demand zone, just under the late-September double low at $86.41)
$82.07 (100 day)
$80.20 (top of the next demand zone)
Bias
The top of the October base at $88.90 is the level to manage against. A settlement above it would mark the zone as holding after a two-day washout and opens a move back toward $92.39 to $92.90, where the 50 day and the old break point stack. A settlement below $86.00 would mean the base gave way and opens $82.07 and $80.20. For sidelined traders, shorting into a demand zone after an 8% day carries poor risk. Sellers may get a better entry on a rally toward $92.39 to $92.90. Buyers may want to see a settlement above $88.90 first.
Seasonal Tendencies Update
(Updated on 11.02.26)
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) $2.94, down 2.4 cents (0.81%) | Session high $2.96, low $2.93
Chart Setup
December settled up 6.4 cents Wednesday at $2.96. That was the first settlement above Monday’s $2.94 high and a second straight higher close off the $2.84 contract low. The intraday high touched $3.00 before sellers stepped in. This morning it’s holding a tight range around $2.94 ahead of the storage report. The lower edge of the falling channel is now near $3.06 and sits directly above Wednesday’s high. The 20 day at $3.19 is the next average overhead.
Key Levels Above
$3.19 (20 day)
$3.06 (lower edge of the falling channel)
$3.00 (Wednesday high)
$2.96 (Wednesday settle and today’s high)
$2.94 (Monday high)
Current Price: $2.94
Key Levels Below
$2.93 (today’s low)
$2.90 (Tuesday settle)
$2.86 (Monday settle)
$2.84 (contract low)
Bias
Monday’s $2.94 high is the level to manage against. A settlement above it would keep Wednesday’s turn alive and opens $3.00, with the channel edge at $3.06 above that. A settlement below $2.90 would erase the bounce and puts the $2.84 contract low back in play. For sidelined traders, the trend still points lower, but this is the first sign of a bottom in weeks. Sellers may get a better entry on a rally into $3.00 to $3.06, with risk defined above the channel edge.
Seasonal Tendencies Update
(Updated on 11.02.26)
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
Don't have an account yet?
Open an account with Blue Line Futures and you will gain access to our daily commodity commentary, free desktop and mobile trading platforms, a 24-hour trade desk, and more. Our online application takes about 5 minutes to complete.
Futures trading involves a substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete, and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.
Blue Line Futures is a member of NFA and is subject to NFA's regulatory oversight and examinations. However, you should be aware that the NFA does not have regulatory oversight authority over underlying or spot virtual currency products or transactions or virtual currency exchanges, custodians, or markets. Therefore, carefully consider whether such trading is suitable for you, considering your financial condition.
With Cyber-attacks on the rise, attacking firms in the healthcare, financial, energy and other state and global sectors, Blue Line Futures wants you to be safe! Blue Line Futures will never contact you via a third party application. Blue Line Futures employees use only firm-authorized email addresses and phone numbers. If you are contacted by any person and want to confirm identity please reach out to us at info@bluelinefutures.com or call us at 312- 278-0500
Performance Disclaimer
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.
Hypothetical Performance Disclaimer
One of the limitations of hypothetical performance results is that they are generally prepared with the benefit of hindsight. In addition, hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk in actual trading. For example, the ability to withstand losses or to adhere to a particular trading program in spite of trading losses are material points which can also adversely affect actual trading results. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results and all of which can adversely affect actual trading results.
Research Disclaimer
All information, communications, publications, and reports, including this specific material, used and distributed by Blue Line Futures LLC shall be construed as, or is in the nature of, a solicitation for entering into a futures transaction. Blue Line Futures LLC does not employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This email may include information produced by third parties. Material not labelled Blue Line Futures LLC should be considered to be third-party, and is provided for informational purposes only. Third-party material is from sources believed to be reliable, but its accuracy is not guaranteed by Blue Line Futures LLC.
Seasonal Disclaimer
This message and its content is intended only for the person or entity to which it is addressed and should not be shared with additional parties. Seasonal tendencies are a composite of some of the most consistent commodity futures seasonals that have occurred in the past several years. There are usually underlying, fundamental circumstances that occur annually that tend to cause the futures markets to react in similar directional manner during a certain calendar year even if a seasonal tendency occurs in the futures, it may not result in a profitable transaction as fees and the timing of the entry and liquidation may impact on the results. No representation is being made that any account has in the past, or will in the futures, achieve profits using these recommendations. No representation is being made that price patterns will recur in the future.
The information and opinions contained herein comes from sources believed to be reliable but are not guaranteed as to accuracy or completeness. The risk of loss in trading futures and/or options is substantial. Each investor must consider whether this is a suitable investment. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results.
Blue Line Futures LLC, 141 W. Jackson Blvd, Suite 2620, Chicago, IL 60604, 312-278-0500
This article contains syndicated content. We have not reviewed, approved, or endorsed the content, and may receive compensation for placement of the content on this site. For more information please view the Barchart Disclosure Policy here.
