Been discussing the trend of the contract months that have expired during 2024 have been amply offered during their closing days (March, April and May traded the lows of their tenure on the day they went to settlement). February didn’t but lost $.443 (from high to low) over its last three days. June lost $.507 over its last four days as it fell from $2.924 to test the continuation 200 – day SMA. July would appear to be on a similar path. Expect expiring July to test the zone of support between +/- $2.450 and $2.640, which includes 50% and 61.8% retracement of the rally from its February low, its 50 – day SMA and the nearly flat continuation 200 – day SMA that held near the low of expiring June. A failure by July to weaken into expiration would indicate a change in the character and or bias of supply and demand for gas.
Changes in market internals, specifically volume and open interest, strongly suggested approaching the gas market with extreme caution from the long perspective. Prompt gas had traded higher highs with diminishing volume. The May high ($2.924) had traded with a weekly turnover of 3,378,217 contracts, the June high ($3.159) with 3,047,011contracts. At the same time July traded a textbook double top when it challenged its May high. On May 23rd 258,561 contracts traded, 200,816 when it reversed lower from the June high but lacked the buyers to push it further.
