In the previous Weekly and Daily writings, the handwriting on the wall that prompt gas would trade a higher high, it was suggested that January’s previous highs +/-$4.95 – $5.05 were likely to present formidable resistance. The zone of resistance did limit January’s advance (for a a few days) but did so with increasing volume and open interest. Price, volume and open interest increasing in tandem indicated that the market was getting a running start at higher highs.
Once January broke through the resistance zone, volatility and the range traded expanded. On Friday the low was $5.027 the high $5.496 (creating the range of $.469). You have to go back a way to find the last time a prompt contract traded a wider range. On March 4th prompt April traded $.495 with 1,094,416 contracts changing hands. That March high that established a higher high with less volume. They may still be counting but Friday’s volume looks to be around 1,107,300
