natural gas

natural gas

Wednesday, June 29, 2016

Natural Gas Corner - Technical Update - Blow Off Top In Progress?




The new front month August 16 natural gas contract traded sharply higher on Tuesday following a breakout above lower-2.800 resistance early in the day.  By the session’s close, the August contract had gained .149 (5.4%) settling the day at 2.890.

While there is no sign of a top forming in the market, recent parabolic trade is indicative of a blow off top which comes near the end of a price move. 

The 2.950-3.050 area is a strong resistance level on the weekly chart and the level the market topped during the summer of 2015. 

The 2.865  overnight low is the first area of support today followed by the previous high at 2.812.  Longer term support is the 10 day moving average at 2.760.  A close back under this average will likely signal a top has been set.

Bottom line – Blow off  top in progress?

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

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