The October 14 natural gas contract rallied off weekly low support for a fifth time in Wednesday’s trade moving back up toward moving average resistance.
The October contract bottomed out at a 3.796 early morning low yesterday but then reversed back higher into the close settling at 3.911, up .095 or 2.5%.
Yesterday’s daily close came in the middle of 10 and 40 day moving average resistance at 3.900-3.920 which has held in the overnight session. A breakout above yesterday’s 3.922 high would turn the lower-4.000 level into the next upside resistance.
If early weakness in the market continues, the 3.740-3.800 area will become support as it has over the past 10 weeks. A breakout below 3.740 would keep the primary market trend down with the 3.589 contract low then becoming the next downside support.
Resistance over the past 10 weeks has been at the 4.000-4.101 with five rally attempts during this time all stalling out at this resistance. A breakout above 4.101 is needed to turn the longer term trend back higher.
Technical Indicators: Moving Average Alignment – Bearish
Long Term Trend Following Index – Bullish
Short Term Trend Following Index - Bullish
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