Natural gas prices closed mostly unchanged on Tuesday as a late day rally negated early morning weakness.
The December 14 natural gas contract traded sharply lower in Tuesday’s early trade falling to a 4.121 low. This low coincided with the 10 day moving average which held as support.
As support held following two days of selling, the market reversed back higher into the close with the December contract settling at 4.247, down 8 ticks.
The 10 day moving average at 4.155 has held again in overnight trade. A drop under this support would turn the 40 day moving average at 3.990 into the next downside support for a possible low.
Current weakness is seen as a downside correction within a greater uptrend. Once a low forms, a rally back higher is expected.
Upside resistance begins at 4.250-4.300 followed by the 200 day moving average at 4.400. Longer term resistance is Monday’s 4.544 high.
Technical Indicators: Moving Average Alignment – Neutral-Bullish
Long Term Trend Following Index – Bullish
Short Term Trend Following Index - Bullish
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