Natural gas prices took a sharp turn lower to begin the new week on Monday with the spot November 14 contract closing at a new 2-week low.
The November contract lost .141 or 3.5% in yesterday’s trade settling at 3.898. Selling has continued overnight dropping the contract the next area of support at 3.855-3.860. This support is a trend line drawn up recent lows.
There have been several sell off attempts over the past 11 weeks which have all found good buying interest at the lower-3.800 level. A drop under this support followed by the 3.786 low set in July would keep the primary market trend sideways to lower with following support at 3.720-3.730 and the 3.658 contract low.
If natural gas prices should continue to weaken near term, it would likely be the final sell off before a seasonal low forms in the market ahead of winter. A breakout above 4.150-4.200 weekly high resistance is needed to turn the longer term trend back higher.
Technical Indicators: Moving Average Alignment – Neutral-Bearish
Long Term Trend Following Index – Bullish
Short Term Trend Following Index - Bearish
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