The July 16 natural gas contract rallied up to a new 2016
spot price high at 2.786 in last Tuesday’s session but couldn’t hold the gains
into Friday’s close finishing the week at the 2.662 level. For the week,
the July contract was up .039 (1.5%), closing higher for a fifth week in a row.
The July contract settled under the 10 day moving average on
Friday for the first time in a month but buyers have come in early today
rallying the market higher. 2.720 is the first area of resistance today
followed by last week’s 2.786 high. A breakout above last week’s high
would turn 2.820-2.830 into the next upside resistance.
Last week’s 2.614 low is the first area of support followed
by 2.495-2.500. Long term support levels are the 200 day moving average
at 2.415 followed closely behind by the 40 day average at 2.390.
Bottom line – Early buying on Monday keeps bullish uptrend
intact.
Funds came into the natural gas market for a third week in a
row according to the Commitment of Trader’s report released on Friday.
The fund long futures position as of the 06/21 close was estimated at 129,978
contracts, up 19,379 from the previous week.
Technical Indicators: Moving Average Alignment –
Neutral-Bullish
Long Term Trend Following Index – Bullish
Short Term Trend Following Index - Bullish
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