Author: Willis Bennett

No Fuss, No Muss, No Movement

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Can’t remember a Holiday period so quiet — sometimes the swings can be quite dramatic with the light trade — not so much last week and yesterday. This is now the first month’s expiration with a price discount in the upcoming prompt that we have had in a while. Don’t think it means or creates any major opportunity for the trade. Suggest letting Jan run a quiet expiration and evaluating afterward.

Major Support:, $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support $2.38-$2.26, $2.17
Major Resistance $2.786-$2.865, $3.00, $3.16, $3.48, $3.536, 3.59, $3.65

Gearing Up For Storage Report

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Will be another bearish report for the market but not a surprise as the market sold off last week based upon the weather forecasts and the decline of demand associated with the mild weather. Still looks like the market wants to consolidate between $2.30-$2.60 for the remainder of the Jan contract. One element that may adjust that range is a short covering rally that breaks above to high end of the trading range. Not sure what would prompt that event.

Due to the Christmas Holiday this will be the last Daily until the 27th as I will be traveling. Best wishes to all of you in this coming period.

Major Support:, $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support $2.38-$2.26, $2.17
Major Resistance $2.786-$2.865, $3.00, $3.16, $3.48, $3.536, 3.59, $3.65

Prices Establish Short Term Lows

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Prices tested the lows from last Friday and rebounded– perhaps the first glimpse of additional consolidation coming. Volumes will continue to lighten through the week as holiday vacations come through.

Major Support:, $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support $2.38-$2.26, $2.17
Major Resistance $2.786-$2.865, $3.00, $3.16, $3.48, $3.536, 3.59, $3.65

Interesting Trade Week

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Prices almost formed a classic DOJI pattern in during the week– that is a pattern from the Candlestick analysis and I have talked about it occasionally here. The pattern is based upon the Japanese technical analysis that discusses the traders open at a price and then extend either higher or lower during the week only to give up the gains or declines by the end of the week to finish where the market started the week. The analysis is based upon the a military exercise where the gains in the beginning of an offensive are achieved but by the end of the period– all gains are given back.

Last week almost formed a good DOJI pattern but the price action did not go back up and close at the price level where prices opened the week. While close — it cannot qualify as a true DOJI week — so what does it mean one way or another — more importantly — what does it mean for the upcoming period?

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High Volume Week and Little Change

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January spiked lower and did so with more than a million contracts changing hands last week. The last time that so many contracts traded (1,003,611) was 03/10/20 (1,039,442), before that 1,602,673 on 11/14/18 (the highest volume ever traded in a day). The only other three day period when so many contracts traded was during March ’20.

Extraordinary volume days…they are obviously pretty rare, are often indications of capitulation by one side or the other when the market has been moving steadily higher or lower. Needless to say, last week’s volume achieving a lower low before rebounding back to where prices started the week (more on that in the Weekly section). It’ll be fun and interesting this week.

Major Support:, $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support $2.38-$2.26, $2.17
Major Resistance $2.45-$2.47, $2.786-$2.865, $3.00, $3.16, $3.48, $3.536, 3.59, $3.65

A Glich

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The chart above is from yesterday as I have lost my software to bring you the latest chart data. The market did close a little higher yesterday, not challenging the gap from Monday. Trade should be patient here until the price action defines itself.

Major Support:, $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support $2.38-$2.26, $2.17
Major Resistance $2.45-$2.47, $2.786-$2.865, $3.00, $3.16, $3.48, $3.536, 3.59, $3.65

Bear Market — Over Sold Conditions Continue

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Not much to add — the RSI on the Daily and January charts are in the extreme over sold zones, the Bollinger study on the Weekly is testing 2 standard deviations under the 20 Week SMA, the Weekly RSI is starting to hit extreme levels — this is not a place where I am going initiate new short positions.

Major Support:, $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support $2.38-$2.26, $2.17
Major Resistance $2.45-$2.47, $2.786-$2.865, $3.00, $3.16, $3.48, $3.536, 3.59, $3.65

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False Break Down ?

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Not actually sure how to interpret yesterday’s action– prices open and gap lower only to have the declines extended during the early opening trade. This was followed by a continuous bullish bias during the day to finish just below the Sunday opening trade. Below the key area at $2.45-$2.47, I can’t call it a legitimate break down in prices due to the price action during the trade day. The follow through over the next couple of days will define a breakdown or fake.

Major Support: $2.47, $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support $2.38-$2.26, $2.17
Major Resistance $2.786-$2.865, $3.00, $3.16, $3.48, $3.536, 3.59, $3.65

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A Bear Bias Shift?

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Go into the reason for the $2.45-$2.47 being a critical area for the near term bias of prices in the Weekly section. I do find it interesting that this is the area the late Sunday night traded to.— Shocking. Spend the time to read the Weekly (less than 3 minutes). Other than that — lets see if we get a near term bias shift.

Major Support: $2.47, $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support $2.38-$2.26, $2.17
Major Resistance $2.786-$2.865, $3.00, $3.16, $3.48, $3.536, 3.59, $3.65

Catch a Falling Knife??

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While still suffering from whatever little kids spread amongst themselves, I hope you bear with this week’s Weekly analysis.

Last week in the Daily editions I mentioned several times about the potential of a short covering. Unfortunately, that did not happen at least not yet. Rather than a short covering rally failure to overcome the declining resistance triggered a high volume extension of the down trend through the November low ($2.669) for the seventh straight year (and 9 of the last 10 the November low has been violated during December) and support expected to be presented by the 200 – day SMA but did not happen. With still higher volume the highest volume day since the October high (678, 722 v 682,359 contracts, and before that the August high 805,853) January plunged to begin a test of substantial conventional support presented by the July/August/September lows, $2.463, $2.425, and $2.500, respectively. Check the Weekly chart below:

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