Previously, the low of May’s tenure was $1.686 ( inside the targeted zone of support, on its second day as prompt). This past week May finally took a couple of shots at closing the “expiration” gap left open on 03/27, neither quite made it. On the 16th May traded to $1.649, on the 17th to $1.660 which leaves a remnant of the gap between $1.647 and $1.649 still unfilled. Perhaps close is good enough natural gas does not like a vacuum, do not be surprised if May completes the task during its last week.
Contrary to that expectation is May’s reaction when it came close -the first time it ripped higher, trading to $1.802 in less than an hour. During the hour before May printed the week’s low 14,008 contracts traded, during the hour that low and reversal traded 50,239 (which makes me think that more than a few participants were paying attention to that gap and scrambling to get out of positions). Since May faded into the close setting up another test (total open interest fell for the first time in five days) it could only have been short covering, but $.153 in less than an hour serves as a good example of how quickly prices can disappear in a thin market.
