Author: Willis Bennett

Prices Continue to Grind Higher

Daily Continuation

The gains continued yesterday and were impressive until towards the end. Trying to challenge the late May high but the closer price got to $2.00 the selling began. Still the range I have been talking about for weeks now, but this is starting to get interesting. Whatever information has been getting into the market — how long it lasts is critical. From a technical perspective a range market testing the consistent range. RSI is continuing to gain but not overbought, the Bollinger Bands are starting to get frosty — but could move another dime without getting worrisome. Volume is supportive for additional gains and the open interest shows gains from last week.

Major Support: $1.484-$1.44, $1.336
Minor Support: $1.527, $1.66, $1.714, $1.829
Major Resistance: $1.864-$1.896, $1.933-$1.944, $1.974, $1.994
Minor Resistance:$

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Bulls May Have Found Footing

Daily Continuous

Looks like the bulls have garnered support near term for advancing. They are now heading into territory held from the June high of continuous prices at $1.896 ( the high when the July contract took over as prompt). July never seriously tested that level again so it will be interesting to watch what happens here– there may be a sea change coming up (no clue why) but the market still reeks of bearish sentiment.

Major Support: $1.484-$1.44, $1.336
Minor Support: $1.527, $1.66
Major Resistance: $1.864-$1.896
Minor Resistance:

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Market Finding a Bid?

Daily Continuation

Prices seemed to catch a bid last week — though I am sure there is a fundamental reason why. With that support, expect prices to continue to show strength until what ever news supported last weeks gains ends and a retest of support begins. The market is still in a historically bearish period for prices (Q3) and don’t see any reason to doubt this year’s seasonal.

Major Support: $1.484-$1.44, $1.336
Minor Support: $1.527, $1.66
Major Resistance: $1.722, $1.864-$1.896
Minor Resistance:

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Post Destructive Expiration – Prices Find Support

Weekly Continuation

Prices closed the Holiday shortened weak on minor strength and nearly on the 50 week SMA and the 10 week SMA. All in all, prices managed to firm after the technical destruction from the July expiration. We are back into the common range that the market has found such comfort for the last few months. Seasonal history tell us to expect more weakness in the coming weeks as the Q3 is notorious for setting a low (usually around the Labor Day period), but this year seasonal highs and lows have not favored historical norm and we can’t rule out the lows of July expiration being the Q3 lows. Tread cautiously in the coming weeks.

Monthly Continuous

Major Support: $1.484-$1.44, $1.336
Minor Support: $1.527, $1.66
Major Resistance: $1.723, $1.864-$1.896
Minor Resistance:$1.759

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Slight Retracement

Daily Continuation

The market retraced some of the gains from Monday and softened some of the trend indicators, however, this does not reflect the end to the run. It is likely that trade in July will follow a series of short covering rallies only to fail at resistance levels similar to yesterday’s price action. The range from the last few months remains intact — be patient and work the range trading on the support and resistance areas.

Major Support: $1.484-$1.44, $1.336
Minor Support: $1.527, $1.66
Major Resistance: $1.722, $1.864-$1.896
Minor Resistance:

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Consolidation of Gains

Daily Continuous

Prices extended the gains from Monday and ran into resistance, but closed higher. A key for prices in the week are volume and participation by the traders. Managed Money long positions gained through the 23rd of June (latest CFTC report available) while short positions were flat. The traders buying on the declines last week, may give some indication of what will happen on the shortened week. History shows that weakness surrounds the holiday period, but that does not confirm that this rally is defunct. Stick to the range trade the market has provided for three months.

Major Support: $1.484-$1.44, $1.336
Minor Support: $1.527
Major Resistance: $1.595, $1.611-1.642
Minor Resistance: $1.722, $1.864-$1.896

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Whoa – Where That Come From

Daily Continuous

Did not expect that reaction to the close last week. Was thinking more of a retest of the premium afforded the August contract, but clearly the market thought other wise. Now we sit in the middle of the range that has held prices for an extended period of time. Technical indications of an over-sold market have relaxed on the run. Continue to expect short term rallies as the Managed Money long positions increased last week through June 23rd while there was a reduction in short positions.

Major Support: $1.484-$1.44, $1.336
Minor Support: $1.527
Major Resistance: $1.595, $1.611-1.642
Minor Resistance: $1.722, $1.864-$1.896

Sunday Trade Brings A Bounce

Daily Continuous

Prices ended last week pressuring being over sold so it is not surprising to see a bounce at the start of trade last night. What will be of more interest is how it plays out during the day. Read the web site for indications and history about last week and what the declines will meet. The market has now broken the range that has held it for weeks so tread lightly (it has gotten more complex). Patience, to see what happens to the declines and bearish mood, in the near term.

Major Support: $1.484-$1.44, $1.336
Minor Support: $1.527
Major Resistance: $1.595, $1.611-1.642
Minor Resistance: $1.722, $1.864-$1.896

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Can It Look More Bearish?

Weekly Continuous

I through out the comment on options expiration (Thursday Daily) that those that had sold the puts at long term support ($1.50) should not be comfortable. It turned out that they were forced to cover positions during the process. Prices continued further but the damage had been done.

Now we face the new prompt (August) and expect the premium afforded the Aug contract to be challenged. That being said, we discussed the Bollinger study recently and last week’s close was THREE standard deviations below the 20 week SMA. While the weekly RSI is not in extreme territory– it could be setting up for a popular bullish divergence (a counter trend indicator)– time will tell.

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Prices Slide into Options Expiration

Daily Continuation

One would expect that those of you who sold $1.50 puts through the months to be comfortable with that position. That said, one has to wonder where this decline will find support. Never get comfortable in Natgas.

Major Support: $1.611-$1.59, $1.555-$1.519
Minor Support: $1.649
Major Resistance: $1.90, $1.974, $2.019- $2.029
Minor Resistance: $1.722, $1.864-$1.896

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