natural gas

natural gas

Friday, July 22, 2016

Natural Gas Corner - Morning Update

Natural Gas Corner - Technical Update - Key Support Area Holds On Thursday




The rally in the August 16 natural gas contract may not yet be over following Thursday test of a key support level.

This support level is the 38% Fibonacci retracement of the March-July uptrend which is at the 2.615 level.  The August contract fell to a 2.625 early morning low on Thursday but rallied back higher into the close once support held finishing the day at 2.692, up .034.

Daily settle back above the 40 day moving average on Thursday has brought in renewed buying interest today as the August contract attempts a breakout above 10 day moving average resistance at 2.720.

A close above this average today will turn the near term trend back up with following resistance at 2.780-2.790 and the 2.871 weekly high set two weeks ago.  Longer term resistance is the  2.998 high set in early-July.

The 40 day moving average at 2.675 is the first area of support today followed by the 2.615.  A close under 2.615 will turn the longer term trend back down.

Bottom line – Bulls back in today with key support holding on Thursday.

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