natural gas

natural gas

Thursday, March 24, 2016

Natural Gas Corner - Technical Update - Is The Rally Over?




An early rally attempt on Wednesday by the April 16 natural gas contract reached a 1.899 high, holding under key resistance at the lower-1.900 level.  With resistance holding for a third day time over the past week sellers came back in dropping the April contract to a 1.794 daily close losing .069 (3.7%) on the session.

Daily settle back under the 10 day moving average turns the near term trend back down but the rally may not yet be over.  The lower-1.900 area which includes a 3-month trend line and the 40 day moving is now key resistance followed by the 1.957 high set last week.

 A breakout above these two resistance areas would be a bullish signal for the market turning the 2015 low at 2.017 into the next upside resistance.

1.750 is the first area of support under the current 1.772 overnight low with longer term support at 1.690-1.700 and the 1.611 contract low.

Bottom line – Is the rally over?

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

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