Rather than my expected recovery (prompt gas typically rallies from a late July/early August low) September continued to find substantial selling between $3.100 and $3.150 (the highs of the last seven trading days have been within that zone and with the exception of a downside reversal day on 7/30 ($3.186) since 07/24. Fading from that band of resistance September traded through the calendar July low ( not particularly unusual, it has now done so in 14 of the last 20 years), but then posted the lowest daily closing price since last November ($2.823, 11/15).
The recovery from Monday’s low of $2.895 (the lowest low since prompt May was about to go to settlement) left the first suggestion of a momentum divergence that we’ve seen during the decline from the June Q2 high. A reversal from the high of that recovery (08/07, $3.148) suggests that September has not yet developed the sponsorship for the expected seasonal “correction”.
