natural gas

natural gas

Tuesday, February 16, 2016

Natural Gas Corner - Technical Update - New Contract Low Set In Today's Early Trade




The March 16 natural gas contract had a failed rally higher to begin last Monday’s trade which was followed by four days of selling into Friday’s close.  For the week, the March contract lost .097 (4.7%) settling Friday at 1.966.

Selling has continues in today’s early trade dropping the March contract to a new contract low at 1.909.  This low is the first area of support today followed by weekly chart support at 1.780-1.790 and the 1.684 spot contract low set last December.

Former weekly low support at 1.954 is now the first area of resistance followed by the 10 day moving average at the 2.025 level today.  A  close back above the 10 day average is needed to turn the near term trend back up.

Bottom line – How low can it go?

The hedge funds came back into the market last week adding to their existing long futures position in natural gas.  Friday’s Commitment of Trader’s report showed the funds long 51,462 contracts, up 8,438 from the previous week.

Technical Indicators:  Moving Average Alignment – Bearish
                                         Short Term Trend Following Index – Bearish
                                         Long Term Trend Following Index - Bearish

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