Today’s expiring December 14 natural gas contract at one point on Monday was down over 6% bottoming out at a 4.006 morning low. But as the day progressed, the contract was able to recoup over half the morning losses settling the day at 4.151, down .115 (2.7%).
The primary trend remains sideways to higher although a drop back into the 3.900-4.000 level near term cannot be ruled out. Once a low does form, a retest of 4.450-4.550 weekly high resistance is expected.
The gap created on yesterday’s open was nearly closed overnight with the top of the gap being 4.233 and a current 4.195 daily high. There should be strong resistance at the lower 4.200 area including the 10 day moving average at 4.215 today.
The 4.100-4.110 area is the first level of support today followed by yesterday’s 4.006 low which coincides with the 40 day moving average at 4.025.
Trade could be volatile again today with the December contract expiring with many traders heading out for the Thanksgiving Holiday.
Technical Indicators: Moving Average Alignment – Neutral-Bearish
Long Term Trend Following Index – Bullish
Short Term Trend Following Index - Bearish
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