Rally, Gap Closed, Selling Commences

Daily Continuous

On script, the open was stronger, only to run into the selling on the high side of the gap. The declines were impressive considering that both the Dutch and Britain contracts closed at the highest levels since early October (10% daily gains). Perhaps we can put that garbage, surfacing amongst fundamental traders last fall, to rest. Never understood the relationship, as the US has a finite amount of LNG export capacity and has been running near those limits most of the fall (regardless of the Dutch price). Fundamental folks always need some sort of narrative to explain the rallies or the declines– usually a useless effort. Now we have another narrative, this time about the weather– yup — Chicago beaches will be open for the Holidays. Wonder how fast that will change? As mentioned a couple of weeks ago, the bias in this market is bearish and selling (or shorting) rallies is critical for economic success. Not saying you can’t buy the dips — support areas– but until the market does something to change the bias this should be the strategy.

Major Support: $3.734, $3.584-$3.522
Minor Support:
Major Resistance:
$3.91-$3.931, $4.02, $4.127, $4.25 $4.61, $4.67, $4.735, $4.825, $5.10

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