Soon to expire June extended its rally to test the continuation 20 – weeks SMA (and its own 20 – weeks average) before reversing lower from an historically consistent mid – May pre Memorial Day high. In eight of the last ten years that short – term seasonal high traded between the 12th and 23rd. Last year the pre – holiday high printed on the 12th (Memorial Day was the 26th) this year on the 20th (Memorial Day is on the 25th. A lower weekly close…after opening above last week’s high ($2.994 v $2.982) with a volume increase (average daily volume increased nearly 70,000 contracts) and a closing short – term uptrend violation indicates that prompt gas will be offered lower before going off the board on Wednesday. Following June expiration the new prompt almost always falls toward a late May/early June low before a rally (which more often than not peaks either side of 06/15 and can be, historically, more often than not the Q2 high.
There is little reason not to believe that prompt gas is likely to continue to adhere to seasonal patterns/tendencies as it has since the blowoff into February expiration. It has been suggested that gas is in the process of constructing a trading range between +/- $2.50 and $3.25 – $3.50 and may continue for much of the remainder of ’26. Gas may test either side of that range while premiums awarded to deferred and distant deferred contracts diminish.
