Author: Willis Bennett

Weakness Into Expiration Is the Recent Trend

Daily Continuous

Expect prompt August to be offered lower but likely recover into expiration as most prompts this year have…the last three settlements were $3.170, $3.204 and $3.261. Expect prompt gas to remain rangebound as it takes over as prompt and during expiration.

Major Support: $3.054-$3.007, $2.97, $2.727, $2.648,
Minor Support : $3.30-$3.26
Major Resistance:$3.25-$3.31,$3.39, $3.62, $4.168, $4.461, $4.501

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Going To Keep Testing Lows

Weekly Continuous

The weight of the seasonal pressure that has been discussed and warned about since before the rally to the June Q2 high, fell on soon to expire August. A year ago, the seasonal descent was more orderly after the June Q2 ’24 high (week ending 06/14) prompt gas declined for six of seven weeks (falling from $3.159 to $1.856, or 41.2%). At the time the weekly ATR was .324. By the time a rally began to gain momentum, following an August test of the July low, the ATR had fallen to .268.

This is another example in natural gas that history does not repeat itself, but some times it rhymes. Since the June ’25 Q2 high (week ending 06/20, a few days after the anniversary of the high) the decline has been far more erratic. Just last week August closed at its highs gaining $.125(and was well – bid in the aftermarket. Volatility, still elevated by historic standards, is $.466/dt/week (+/- 40% higher).

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Rebound Off of Support Test

Daily Continuous

The declines neglected challenging the key support area and on the storage release rallied over $.10 but gave the gains up during the remaining trade. Still believe that any declines will be rejected at the support lows — that said would not load up on length.

Major Support: $3.054-$3.007, $2.97, $2.727, $2.648,
Minor Support $3.30-$3.26
Major Resistance:$3.16-$3.25, $3.43, $4.168, $4.461, $4.501

Testing the August Contract Lows

Daily Continuous

The initial test of the August low was met with expected support. That support may not suggest a rally to take prices to test resistance. The low test is not complete as the internals hint additional declines may be coming.

Major Support: $3.25-$3.16, $3.054-$3.007, $2.97, $2.727, $2.648,
Minor Support :$3.62, $3.46, $3.30-$3.26
Major Resistance:$4.168, $4.461, $4.501

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Testing August Low’s

Daily Continuous

As mentioned yesterday, personal family issues are going to minimize the analysis for the early part of the week. All I can say about yesterday’s and tomorrow’s trade will be seeking the lows of the calendar July with the August contract.

Major Support: $3.25-$3.16, $3.054-$3.007, $2.97, $2.727, $2.648,
Minor Support :$3.62, $3.46, $3.30-$3.26
Major Resistance:$4.168, $4.461, $4.501

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Continue Lower

Daily Continuous

Explain the brevity of the Daily due to some issues explained in the Weekly Section. While I wait in the ER for my dog it is evident that the market wants to trade lower tomorrow. Hang tough or keep playing the low end of the Aug range.

Major Support: $3.25-$3.16, $3.054-$3.007, $2.97, $2.727, $2.648,
Minor Support :$3.62, $3.46, $3.30-$3.26
Major Resistance:$4.168, $4.461, $4.501

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Trade Looks to the Low Side of August Range

Weekly Continuous

This week’s report is going to be short as I am taking my dog to the emergency vet service. Over the history of August contracts there have been a few that the late summer contract rallied for most of its tenure and was bid into expiration, ‘21 and ’22 are the most recent examples. In both of those years prompt gas set a calendar August high before falling. There have been a few that steadily weakened, ’17 and ’18 are examples. In both of those years prompt gas made a late July/early August low before a significant rally.

More often than not, August follows a pattern of trading a post – 4th low, a mid – July high followed by weakening to a low either side of 7/23 – 7/25.Look for August ’25 is conforming to that seasonal pattern. The 07/09 undercut of the June low ($3.199 on 06/26 ) was on far and away highest volume traded since then.

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A Brief Test

Daily Continuous

Prices tied to test and break the early July high only to fall back. Still looking at a quiet range trading market in this market at this point in the month.

Major Support: $3.25-$3.16, $3.054-$3.007, $2.97, $2.727, $2.648,
Minor Support :$3.62, $3.46, $3.30-$3.26
Major Resistance:$4.168, $4.461, $4.501

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Break Out ?

Daily Continuous

Would consider a break above $3.50 a breakout and the fact it was not held with volume expansion (nor open interest– not published yet) I would consider it a top of the range test. Hang tight — volatility will appear sometime.

Major Support: $3.25-$3.16, $3.054-$3.007, $2.97, $2.727, $2.648,
Minor Support :$3.62, $3.46, $3.30-$3.26
Major Resistance:$4.168, $4.461, $4.501

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Expectations Met

Weekly Continuous

I wrote last week —The expectation was the decline to occur on either 07/07 or 08. Instead, August fell $.458 (12.2%) on 06/30 and 07/01…closing the gap and trading just through the low of the first targeted support band ($3.300 – $3.350). Well the declines continued to July 9th and promptly met the expectations for the size of the declines (in fact exceeded them). Once the low was set, prices bounced and returned to with in the range for the July contract and now seemingly the August contract. Folks, this market seems to being going nowhere and at a slow pace.

Understanding the frustration of many of you (for volatility– myself included) but my ideas are to highlight what I see the market is trying to accomplish and clue you in advance of the movement– unfortunately this market is showing no movement beyond the range each successive contract trades within. There may be an occasional lapse in Daily diatribes during these periods.

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