Author: Willis Bennett

As Expected – Seasonal Weakness Commences

Daily Continuous

Discussed in yesterday’s postings that this period of time of the year, is historically a weak time of the year and sure enough, prices softened yesterday. Declines went to the lows from a small daily gap at $3.62 — likely to be tested today. I don’t see prices breaking down below but my sight is often clouded.

Major Support: $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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Prices May Get Support

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Discuss the historical aspects of the late June and early July price movements in the Natural Gas market in the Weekly Section– suffice to say — it is a weak period of time historically. Though last week provided a bullish break out — the coming two weeks may challenge that break out. The wild card in all of it, is the attack on Iran which is likely to bring a bid to crude oil and may spill over to the gas market –will have to wait and see.

Major Support: $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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Seasonal Weakness Approaches

Weekly Continuation

The market is approaching one of the most consistently price negative periods all year. For those that care about such things, I can provide a schedule Larry Marshall has maintained since 1995 if you need to see it. The declines bracketing Independence Day which shows a quantifiable decline usually from a mid/late June high to many times a just post – holiday low. While some of the declines are negligible (just 6.2% in ’19) and some are dramatic (35.7% in ’08) the 3, 5, 10 and 20 – year averages are pretty consistent, 14.1%, 13.7%, 13.5% and 16.4%. The 3 – year average 14.10%, the 5 – year average is 13.68%, and the10 – year average 13.47%. Refresh your memory in 2024 the June pre-holiday high at $3.159 to the early July low at $2.249– before extending the declines through July to early August– setting the low of $1.882. Looking at last week’s rally as the pre-holiday high at $4.148 a similar decline to the historical averages would indicate a $.58ish decline around or after the holiday.

Not sure how the mid-east issues will impact gas prices as the crude prices will be well bid going into the week. Think it would be prudent to sit on the sidelines until the response from Iran gets defined.

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Break Out Confirmed?

Daily Continuous

Will be cautions in hitting the buy button today– While the breakout is solid will be giving it a pause for the end of the week. Four consecutive up days in this market gives me pause for evaluation.

Major Support: $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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Possible Break Out Extends

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Coming up on a storage report that may or may not confirm the break out above the resistance levels. Time and trade today will confirm. Keep in mind the idea of selling premium should the rally continue. Not sure what is driving the run beyond the annual trend of price strength in Q2 (concerns about storage into the fall season). Today will bring some clarity of the reasons.

Major Support: $3.054-$3.007, $2.97, $2.727, $2.648,
Minor Support :$3.62, $3.46, $3.30-$3.26
Major Resistance:$3.86, $4.168, $4.461, $4.501

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Is This a Breakout

Daily Continuous

Impressive rally took prices to and above the May highs which could be considered a “breakout” from the recent range boredom. Be careful here as that is just step one to conclude whether it is a break out or just a head fake. Volume was up on Monday — open interest — flat. Be patient at these times.

Major Support: $3.054-$3.007, $2.97, $2.727, $2.648,
Minor Support :$3.46, $3.30-$3.26
Major Resistance: $3.628, $3.86, $4.168, $4.461, $4.501

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Boring

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The market provided me a wonderful Father’s Day gift by doing nothing in terms of bias and or price movement. Even the Weekly section is weak on content — play the ranges the market continues to provide by selling premium.

Major Support: $3.054-$3.007, $2.97, $2.727, $2.648,
Minor Support :$3.46, $3.30-$3.26
Major Resistance: $3.628, $3.86, $4.168, $4.461, $4.501

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Stalled

Weekly Continuous

What can you say after another week with little or no movement beyond the ranges established. Will note that a higher high than the previous week is a bullish signal but the failure afterward was mitigating. From a technical stand point — nothing to really add or try to embellish from my recent comments. Sell the premium until the market decides on a bias.

Major Support: $3.054-$3.007, $2.97, $2.727, $2.648,
Minor Support :$3.46, $3.30-$3.26
Major Resistance: $3.628, $3.86, $4.168, $4.461, $4.501

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Bearish Storage–Prices Decline–Momentarily

Daily Continuous

Price action confirmed the bearish storage report for a short period of time only to spend the rest of the trade day recovering the declines. Time only profits the option trades as price action plays the range.

Major Support: $3.054-$3.007, $2.97, $2.727, $2.648,
Minor Support :$3.46, $3.30-$3.26
Major Resistance: $3.628, $3.86, $4.168, $4.461, $4.501

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Nothing To Add

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Can not add to the previous three Daily’s nor the Weekly on Monday.

Major Support: $3.054-$3.007, $2.97, $2.727, $2.648,
Minor Support :$3.46, $3.30-$3.26
Major Resistance: $3.628, $3.86, $4.168, $4.461, $4.501