Consolidation and Continuation of Recent Trend

Weekly Continuation

Three Friday’s ago, prompt February traded down to new lows for January.  That weakness brought an expectation of lower prices when trading resumed.  Rather than follow through to the downside prompt gas opened and left a small gap higher.  February hardly looked back before settlement .314 higher than that weak previous week’s close.  Last Friday, new prompt March didn’t give up all the expiration week gains but traded a daily reversal lower (that was discussed), dropping .146 from the day’s high and ended the week only a penny off the low.  The declines last week, with the selling, brought a similar expectation, March would be offered lower when trading reopened.  Instead, the first trading day of February began with another small gap higher (2.710 – 2.712). 

Needless to say, after last week’s weak close, expect prices to open higher on Monday, the question remains if the market has the support to close above the key resistance area around $3.00. Twice, last week, prices rallied above $3.00 only to find significant selling and resistance that sent prices down below $2.90 and into support zones. Will a third time be the charm?

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