The natural gas market was heavily sold in last week’s trade as most of the forward contracts fell to a new all-time lows.
The spot January 15 contract lost nearly 7% during the week bouncing higher on Friday to close at 3.802.
The near term trend remains down as the market is again down sharply lower in early trade today.
Last Thursday’s 3.638 low is the first area of support followed by the October 2014 spot contract low of 3.541.
Whether or not the October low can hold as support will be an important technical test for the market. If support is broken, the late-2013 weekly lows at 3.380-3.400 will become the next longer term support.
3.780-3.820 is the first area of resistance with longer term resistance at the 10 day moving currently at 3.995. 10, 40 and 200 day moving average alignment turned bearish last week.
The funds sold existing long positions in the natural gas market as it fell to new lows for the year last week. Friday’s Commitment of Trader’s report showed the funds long 151,752 contracts (futures only), down 16,432 from the previous week. The funds were record long 488,901 contract last February.
Technical Indicators: Moving Average Alignment – Bearish
Long Term Trend Following Index – Bullish
Short Term Trend Following Index - Bearish
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