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
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:
If you are good at catching falling knives– get the gloves on. Extensions downward –putting prices below the extreme over sold levels on the RSI chart above,suggest that the closer the price gets to $2.48-$2.46 may be a good area to try and catch one with the stop at $2.45. Got no clue but that would break the series of high lows and higher highs.
Major Support: $2.608, $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
Prices took a day off of the declines, now seem to be consolidating the recent losses. Not convinced that the declines will not test the support from the bullish environment (since Apr ’22 — series of higher lows) around $2.47, but am not entering this market with length until it gives me a reason to.
Major Support:$2.82-$2.78, $2.74, $2.608, $2.47, $2.00, $1.991-$1.96, $1.795-$1.766 Minor Support $2.68, $2.38-$2.26, $2.17 Major Resistance $3.00, $3.16, $3.48, $3.536, 3.59, $3.65
Had some questions yesterday when the market gaped lower on the open when it was over sold. Please remember that technical indications are usually based upon mathematics and one of the common indicators we use is the Relative Strength Indicator (RSI). As you will notice in the chart above — the RSI is approaching the lower level of 20 which indicates over sold. This does not mean it can’t go lower but notice on chart — it doesn’t stay there for long. Look at the chart below which is the Spot January chart which is well below 20 and is considered extremely over sold.
Daily Spot January Contract
Even though the technical indicator is under 20 — does not mean that it can’t go lower but how long it stays there is another question. When markets are extended to extreme levels — they are subject reversals that punish the late momentum players.
Am feeling a little better today and will work on the Weekly tomorrow.
Major Support:$2.74, $2.608, $2.47, $2.00, $1.991-$1.96, $1.795-$1.766 Minor Support $2.68, $2.38-$2.26, $2.17 Major Resistance $3.00, $3.16, $3.48, $3.536, 3.59, $3.65
Going to keep it brief this evening and will expand during the week as my granddaughter decided to give me her respiratory bug. Actually, not much to say except the element of trade that has kept the market from becoming grossly over sold is the premium that the new prompt brings after expiration of the previous contract. Will go into the specifics during the week but the market is oversold and is setting up for a reversal (doubt it will be today).
Major Support:$2.82-$2.78, $2.74, $2.608, $2.47, $2.00, $1.991-$1.96, $1.795-$1.766 Minor Support $2.68, $2.38-$2.26, $2.17 Major Resistance $3.00, $3.16, $3.48, $3.536, 3.59, $3.65
Under the weather (so to speak) from my granddaughter’s virus — will be back on board (I hope) tomorrow — all I can say tonight is that prices are lower Sunday night and want to go lower.
Major Support:$2.82-$2.78, $2.74, $2.608, $2.47, $2.00, $1.991-$1.96, $1.795-$1.766 Minor Support $2.68, $2.38-$2.26, $2.17 Major Resistance $3.00, $3.16, $3.48, $3.536, 3.59, $3.65
Was expecting prices to go down to the expiration level of the Dec contract — while close not quite ($2.68-$2.706). Starting to wonder with all the bearish fundamental (forecast data) built into the Jan contract — What is going to send it lower– don’t think technical data points will as they are starting to become over sold– would be hesitant to initiated significant bearish positions here.
Major Support:$2.82-$2.78, $2.74, $2.608, $2.47, $2.00, $1.991-$1.96, $1.795-$1.766 Minor Support $2.68, $2.38-$2.26, $2.17 Major Resistance $3.00, $3.16, $3.48, $3.536, 3.59, $3.65
Bearish trade continues and would expect further declines on the storage report unless all the folks have already sold in anticipation. We shall see but it is not looking good for bullish positions.
Major Support:$2.82-$2.78, $2.74, $2.608, $2.47, $2.00, $1.991-$1.96, $1.795-$1.766 Minor Support $2.38-$2.26, $2.17 Major Resistance $3.00, $3.16, $3.48, $3.536, 3.59, $3.65
It took some time but the expiration gap from last September finally got filled. So trade action closed both gaps it inherited — both resistance and support. Now what– my attitude will remain consistent with prior months in letting the market define its bias near term– but there is a clear bearish tilt going on now.
