An early bounce on Monday had the January 15 natural gas contract higher by nearly .140ion the overnight session. But the early strength was short-lived as sellers came back in dropping the market lower into the close.
The January contract finished the session with a .076 loss (2%) settling at 3.719.
10 day moving average support at 3.705 has been broken today turning the near term trend back down as the January contract trades back toward the lower-3.600 level.
Last week’s 3.585 low extending down to the 3.541 low set in late-October remains primary support. A drop under 3.541 would turn the late-2013 weekly lows at 3.380-3.400 into the next downside support area.
The 10 day moving average now becomes resistance at 3.705 followed by the 3.936 high set on Monday.
Bottom line – The bears back in control to see if they can push the market under 3.541-4.585 weekly low support.
Technical Indicators: Moving Average Alignment – Bearish
Long Term Trend Following Index – Bearish
Short Term Trend Following Index - Bearish
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