The October 15 natural gas contract has been mired in a
.100+ sideways trading range over the past 2 weeks alternating between support
at the lower-2.600 area and resistance at the lower-2.700 level.
In last week’s trade, the October contract pushed down to a
new contract low at 2.633 in last Thursday’s session closing Friday at
2.655. For the week, the contract lost .060 or 2.2%.
The trend remains sideways to down with last week’s
2.633 low being the first area of support followed by weekly chart support at
2.550-2.560 and 2.440-2.450.
The 10 day moving average at 2.690 is the first area of
resistance followed by last week’s 2.725 high. Longer term resistance is
the 40 day moving average currently at 2.800.
Friday’s Commitment of Trader’s report showed a sharp drop
in the speculative long position in the natural gas market by the funds.
The fund long position plunged by 25% or 32,727 contracts to 99,375 contracts
as the spot market fell to a new 3-month low.
Technical Indicators: Moving Average Alignment –
Bearish
Long Term Trend Following Index – BearishShort Term Trend Following Index - Bearish
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