Author: Willis Bennett

Surprise Suprise

Daily Continuous

Didn’t see that coming as expectations were for additional weakness on the start of this week. If you are bull settle down — we have seen this behavior on a Monday before on see the declines shortly there after. If you are a bear — got to love $.15 – $.20 more for the declines back to $2.00.

Major Support: $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support:
Major Resistance $2.12-$2.184, $2.41, $2.836, $3.00, $3.536, 3.595

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Price Action Getting Ugly

Weekly Continuous

On Good Friday (I forgot no trading) I wrote the following….Prices dropped below $2.00 and suggested closing below that important area but found some minimal support. A close below that level sill suggest additional declines will be coming. Today will provide some important indications for the May contract and bias objectives going into the historically strong summer (power demand) season. Well — there was no trading on Friday and the market remains at the Thursday close.

There are no technical indications of a positive bias entering or even attempting to enter this market (that in itself leaves me with a positive bias). While total volume has on balanced declined since mid – February, particularly since the March high, average daily volume increased significantly during a period that it typically does not (volume is historically subdued during a shortened week, this past week Thursday was the highest volume day since the 03/21 upside reversal day). Increasing volume as price falls is technically negative.

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My Bad –Happy Easter

Daily Continuation

I wrote this last Thursday, forgetting that the gas market was closed for Good Friday — but the comments remain in affect.

Prices dropped below $2.00 and suggested closing below that important area but found some minimal support. A close below that level sill suggest additional declines will be coming. Today will provide some important indications for the May contract and bias objectives going into the historically strong summer (power demand) season. We shall see. For me still in the range and at the low end.

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Prices Almost Close Below Support

Daily Continuous

Prices dropped below $2.00 and suggested closing below that important area but found some minimal support. A close below that level sill suggest additional declines will be coming. Today will provide some important indications for the May contract and bias objectives going into the historically strong summer (power demand) season. We shall see. For me still in the range and at the low end.

Major Support: $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support:
Major Resistance $2.12-$2.184, $2.836, $3.00, $3.536, 3.595

Snoozing Along

Daily Continuation

Wish I could have some enlightening analysis — Not happening

Major Support: $2.127-$2.095, $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support:
Major Resistance$2.836, $3.00, $3.536, 3.595

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Quietest Daily Range in A Long Time

Daily Continuous

As much as I would love to thrill you with some startling and creative technical interpretation of the price action– after yesterday — I am concerned whether you will continue to log in. Nothing more to add to the last few installments of the Daily but play the range with patience and stop losses.

Major Support: $2.127-$2.095, $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support:
Major Resistance$2.836, $3.00, $3.536, 3.595

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Another Test of $2.00

Daily Continuation

Starting Sunday night, it was clear prices were going to test the $2.00 area and that is what happened. Finding limited support — not sure how far the run goes off of the test — continue the range trade if you are patient enough.

Major Support: $2.127-$2.095, $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support:
Major Resistance$2.836, $3.00, $3.536, 3.595

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Weak Expiration — Leaves Bears Growling

Daily Continuation

Prices start off Sunday night weaker, gaping lower and starting to test the $2.00 zone quickly as the May contract takes over as prompt. Trading to a low, rallying and then returning to that prior low and holding, is the primary method of natural gas defining a longer term low. This week prompt gas undercut the first low but failed to follow through to the downside re-defining support as a zone between two monthly lows, ($1.944 – $1.967). Not nearly enough time has passed to draw a definitive conclusion, but new prompt May ended Friday above the continuation 10 – day SMA for the first time since the failure of the rally from the February low, thatvery short – term moving average served as declining resistance at multiple daily highs since prompt April first closed beneath it on March 8th.

Major Support: $2.127-$2.095, $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support:
Major Resistance$2.836, $3.00, $3.536, 3.595

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Price Declines on Expiration — Expect More

Weekly Continuous

In my absence, prices decided to test the support at the Feb lows and break below it briefly. There have been some ugly monthly ranges traded since prompt gas turned down last August, the chart for calendar March is as ugly as any. After a technically positive calendar February prompt April promptly traded through the previous month’s high on March’s first trading day then before its tenure was over plunged through its low creating the first “outside” March since 1998 and the first ever to reverse to the downside (in ’98 the prompt first traded through the Feb low before rallying through and closing above the Feb high). The continuation monthly bar could have only been uglier if the close had been below the Feb low which owing to May’s premium over expired April and Friday’s only higher daily close of this week,, it wasn’t. The monthly chart of May gas did achieve that benchmark and is even uglier as it closed lower for the week, month, and quarter below its February low.

As patently bearish as the market seems, and expecting the consensus of technical indicators had weakened further from the prior week’s negative to neutral bias “ to outright negative, close examination indicated that was not the case. Almost none of those indicators confirmed the lower price low which either means they are out of step with reality and need time to catch up although recent price ranges have been relatively modest so that should not be the case, or the subsurface dynamics are diverging from the persistent price weakness. For example, last week average daily volume accelerated as April fell toward a new low weekly close and as has become the custom closed below the previous week’s low. Market internals…volume and open interest, which also continued to increase as price fell, strengthened the technical presumption that April would be offered lower before going off the board.

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This Time Declines Fall Short of March Low

Daily Continuation

Solid run for support but prices couldn’t muster the strength to test the lows — in fact they just got to $2.127 before buying showed up. This area down to $2.095 will provide a major hurdle for further attempts at the Feb lows. Going to keep saying — play the range and sell premium when available. I am traveling to Mexico for the next seven days and the internet is not going to be an option. Should be back to look at the expiration during the middle of next week.

Major Support: $2.127-$2.095, $2.00, $1.795-$1.766
Minor Support:
Major Resistance$2.836, $3.00, $3.536, 3.595

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