Natural gas prices rocketed higher on Thursday closing up for an 8th consecutive day. Yesterday’s session was the strongest of the past 8 as the December 14 contract gained .210 or 5% settling at 4.404, the highest closing price level since July.
The December contract over the past 8 days has risen by .837 or 23% from the 3.620 low set last week up to yesterday’s 4.457 high.
The market also broke out above 4.250-4.300 daily high and weekly chart trend line resistance on Thursday which turns the longer term trend higher into early-2015.
Former resistance at 4.250-4.300 now becomes primary support in addition to the 10 and 40 day moving averages which are currently down near 4.000.
The 200 day moving average was reached yesterday for the first time 4 months. This average at 4.400 extending up to yesterday’s 4.457 high will remain primary resistance.
The 4.440-4.450 could be a formidable resistance area to clear as this area was former daily low support first in April and later in June. A breakout above 4.457 would turn 4.540-4.550 into the next upside resistance.
The Commitment of Trader’s report is scheduled to be released this afternoon. It will be interesting to see how active the funds have been in this market in recent trade. The funds were long approximately 149,000 contracts according to last week’s report.
Technical Indicators: Moving Average Alignment – Neutral-Bullish
Long Term Trend Following Index – Bearish
Short Term Trend Following Index - Bearish
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