Weekly Continuous
Although working against the current of seasonal price negative bias, until fading on Friday October gas had closed higher for eight straight days (it has been a while since any contract did that). For the holiday shortened trading week the prompt was the only contract to gain, + $.051, but November’s loss was negligible, $.005. The other ten months of the one year strip lost $.035 to $.071.
The price level attracting sellers was obvious…the declining 50 – day SMA. The highs of three of this week’s four trading days were within a penny of the gradually falling moving average. Interestingly enough, the continuation 50 – day SMA was an influence then as it was during the past week, once breached it became support for a rally that extended through October ‘24’s last trading day. Last year, following October ‘24s rally into expiration new prompt November gas up the gains and returned to test the 50 – day before December kicked off the real Q4/Q1 rally that finally peaked on March 10th.
The consensus of technical indications, which began to improve last week, improved enough to be rate neutral – negative after remaining negative for nine weeks. A week ago neither volume nor open interest confirmed lower lows…this week average daily volume and open interest increased along with October. Prompt gas reversed from more than two standard deviations below the 20 – week. This week’s higher trade tends to confirm that reversal. The daily ATR increased a little…from $.126 to .$131. The weekly ATR fell to $.380. The moderation of volatility may become a significant technical factor.
Major Support: $3.00-$2.97, $2.843, $2.727, $2.648
Minor Support :
Major Resistance: $3.061, $3.16, $3.192, $3.25-$3.31,$3.39, $3.62, $4.168, $4.461,