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A Rally Off Of Near Term Support

Daily Continuous

Daily Continuous

Major Support: $3.108, $3.045, $2.956, $2.874, $2.836, $2.762, $2.711, $2.704

Minor Support: $3.152, $3.13, $2.938, $2.783, $2.704, $2.695, $2.61

Major Resistance: $3.297,$3.341, $3.431

Minor Resistance: $3.368

Not surprising to see the rally yesterday as price failed at breaking down to support with the Dec contract— so it looks like a test of resistance is upon us. Prices have now been consolidating for three weeks and seem to setting a base for an extension possibly above last months, but clearly to the highs set in Oct.  Most of you know where the potential extension (initially) will run up to as we trade into the Q4 high and should any fundamental factors (demand) support the technical move upward to resistance then higher levels may be achieved.  The most important factor remains the forecasts and supply going into the winter. With the fundamentals data showing the growth in production (due to the take-away capacity) rising, will the trade see that as a cap to prices.  Still believe the market is headed for continuing re-assessment of the internal fundamental struggle of production vs inventories— that the market has been dealing with since June. The technical data points still lead to a test of the Oct highs. 

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