The March 15 natural gas contract broke out under 3 week and contract low support in last Thursday’s trade falling 9% over the course of the week.
After settling Friday’s session at 2.691, the March contract has continued down overnight trading to a 2.629 morning low. This low is the first area of support followed by weekly chart support at 2.575 from August 2012.
If the August 2012 low is reached and is broken as support, the next level of support will become 2.380-2.400. Longer term support is between 2.170-2.230 and could be tested over upcoming weeks of trade.
Former support broken last week between 2.750-2.760 now becomes the first area of resistance followed by the 10 day moving average currently at 2.825.
Friday’s Commitment of Trader’s report showed fund actively liquidating existing long positions in the natural gas market. Funds are long 93,374 contracts, down 19,390 from the previous week.
Technical Indicators: Moving Average Alignment – Bearish
Long Term Trend Following Index – Bearish
Short Term Trend Following Index - Bearish
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