The natural gas market stabilized on Tuesday following Monday’s heavy sell off as the May 15 contract traded higher for most of the session.
After finding buying support for a second day at the 2.533 level, the May contract rallied up to a 2.597 morning high before closing the day at 2.575, up .039.
Buying has come back into the market moving the May contract up to a 2.618 overnight high. The open gap area created on Monday’s lower open has almost been closed between 2.596-2.625. This gap has been a supportive feature for the market.
The primary trend remains down with the top of the gap at 2.625 being the first area of resistance followed by 2.690-2.700 which includes last week’s high as well as the 40 day moving average.
The weekly low at 2.533 is the first area of support followed by the2.475 contract low set last Monday. Longer term support is at 2.390-2.400.
Technical Indicators: Moving Average Alignment – Bearish
Long Term Trend Following Index – Bearish
Short Term Trend Following Index - Bullish
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