natural gas

natural gas

Tuesday, January 6, 2015

Natural Gas Technical Update - Monday's Early Morning Rally Fizzles


At one point on Monday, the February 15 natural gas contract was trading over 5.5% above Friday’s close.  But as has been the case over the past 7 weeks, sellers came in on the early strength to push the market back lower by the session’s close.

For the day, the February contract lost .121 or 4% settling  at 2.882.

The market has continued lower in the overnight session retesting 2.805 contract low support set last week.  This low extending down to 2.750 is the first support area.  If support is broken, the 2.575 weekly low from August 2012 will become the next downside objective for the February contract.

This market is looking very similar to the winter of 2011-2012 when the spot price fell from a high just under 5.000 in June 2011 to an eventual low of 1.902 the following April of 2012.

Technical Indicators:  Moving Average Alignment – Bearish
                                         Long Term Trend Following Index – Bearish
                                         Short Term Trend Following Index - Bearish

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