A small rally higher on Tuesday by the November 14 natural gas contract was met with a wave of renewed selling in yesterday’s session.
For the day, the November contract fell by .052 (1.4%) erasing all the previous day’s gains to settle at 3.659.
Selling has continued overnight dropping the November contract to a new contract low of 3.616. The next support areas from the weekly chart are 3.545-3.550, 3.490-3.500 and 3.379 which was set in November 2013.
The near term trend for natural gas remains down. But this is expected to be the final seasonal break for 2014. Once a bottom does form, a winter rally back higher is expected. A breakout above weekly high resistance between 4.150-4.200 is needed to turn the longer term trend back higher.
Technical Indicators: Moving Average Alignment – Bearish
Long Term Trend Following Index – Bearish
Short Term Trend Following Index - Bearish
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