For whatever reason prompt gas has a habit of beginning (or in close proximity to the beginning) each new year with a significant event and more often than not, that event takes the form of a gap. Not sure if history will rhyme this year, but you may want to consider just a couple of factors: 1) In six of the last seven years began with a gap one way or the other, and far more important, 2) that the January high and low historically carry disproportionate importance. For example, in 2019 the new prompt February gaped lower on the last trading day of the year. That gap was filled and the January high traded on 01/15. That high held the market throughout the year. The January ’19 low was not traded until the 29th…and was promptly violated on the first trading day of February. In 2020, there was no gap but the rally in early Jan ’20 set the high for the year. Last year, the market had a gap at the end of December only to rally, rally with a gap at the new year, but prices never challenged the low from the late Dec gap.
Again, based on all the history we have, whatever the January extremes turn out to be are going to be important to your planning for the year. It is easy to lose sight of the importance of price levels traded early on. Just about everyone in the market seems to have interest and more attention to short – term fluctuations but I encourage you to at least give price change during January your attention.
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