The April 15 natural gas contract continues to trade just above key support at the 2.680-2.700 which was reached during Monday’s session.
The market moved back higher on Tuesday as support held again with the April contract gaining .053 (1.9%) settling at 2.786.
The April contract remains in a sideways consolidation pattern which has been in place since the mid-January high. Support has been between 2.660-2.700 with recent selling resistance reached last week at the lower-2.900 level. A breakout from this range is needed to determine the next move for the market.
A downside breakout under 2.680-2.700 support would turn the 2.589 contract low into the next downside support with longer term support between 2.400-2.450.
An upside breakout above lower-2.900 resistance would turn 3.045 and 3.194 into the next resistance levels. It would also turn the longer term market trend back up.
Given the trend for the market, the eventual breakout will likely be to the downside under weekly low support.
Technical Indicators: Moving Average Alignment – Neutral-Bearish
Long Term Trend Following Index – Bullish
Short Term Trend Following Index - Bullish
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