Author: Willis Bennett

Price Run Hits a Wall

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Price action got slapped coming out of the pre-holiday run and returned $.25 yesterday. Now we head into expiration and there is a significant discount of the Jan contract to the Feb. While figuring out how that is going to work out, traders get a storage release to evaluate, Some traders use the options market if they have to have a position on. I am expecting some declines in the Jan contract going into expiration and for Feb to hang tight.

Major Support:,$2.727-$2.784, $2.648, $2.39, $2.35, $2.112,
Minor Support : $3.39-$3.31, $3.167, $3.00-$2.95, $2.914, $1.856,$1.89-$1.856
Major Resistance: $3.631-$3.681, $3.829, $3.92, $4.00

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Dec Rally Falls Short

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The run to send prices to the high testing $4.00 fell short and declined during the day. Did not expect that test of the upper end of the range, but the market may have defined the range for expiration. With volume and participation of traders reduced due to the holiday, volatility and daily ranges will be higher.

Major Support:,$2.727-$2.784, $2.648, $2.39, $2.35, $2.112,
Minor Support : $3.39-$3.31, $3.167, $3.00-$2.95, $2.914, $1.856,$1.89-$1.856
Major Resistance: $3.631-$3.681, $3.829, $3.92, $4.00

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Breakout Excitement

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Made comparisons to last week’s price action to this week’s and that comparison ended quickly after the storage release. Price didn’t give up the gains after the week, but rather, closed the day at the highs of the day and then extended those gains in the after-market. I do not recommend play the lightly traded after market, so I will be waiting until the full market opens. Clearly, the recent range trade has been extended, and adjustments to the trading the range should wait for confirmation today. Remember, there have been “breakouts” before only to get slammed the next day.

Major Support:,$2.727-$2.784, $2.648, $2.39, $2.35, $2.112,
Minor Support : $3.39-$3.31, $3.167, $3.00-$2.95, $2.914, $1.856,$1.89-$1.856
Major Resistance: $3.487, $3.527–$3.563, $3.631-$3.681

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Similar Drift Upward to Last Week

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Similar trade behavior to last week with the early week weakness followed by a small rally into the storage release. Last week the Thursday rally set the high for the week before melting back into the range on Friday. Have to wait and see how this report effects price action but from the trading standpoint you have to continue trading the range.

Major Support:,$2.727-$2.784, $2.648, $2.39, $2.35, $2.112,
Minor Support : $3.167, $3.00-$2.95, $2.914, $1.856,$1.89-$1.856
Major Resistance: $3.307 $3.392, $3.487, $3.527–$3.563

Whip-saw Confusion

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I must admit that from a technical standpoint yesterday is understandable as prices found support from a near term zone. What I get confused about is the weather forecasts have above temps through the Holiday which historically pressured prices in Dec. Stick with the range discussed here several times and be nimble. Seems to be something else in the Natural air.

Major Support:,$2.727-$2.784, $2.648, $2.39, $2.35, $2.112,
Minor Support : $3.167, $3.00-$2.95, $2.914, $1.856,$1.89-$1.856
Major Resistance: $3.307 $3.392, $3.487, $3.527–$3.563

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Declines Run Low on Volume

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The start on Sunday night stated with a big decline and extended those declines in the middle of the night — only to find a gradual support bias that took prices back to where the initial opening decline began the trade. Again, the range has likely been developed during the last week or so. Mentioned it in the Weekly last week. Use the option market for short term gains in the next week as volume based bias is unlikely to present itself.

Major Support:,$2.727-$2.784, $2.648, $2.39, $2.35, $2.112,
Minor Support : $3.167, $3.00-$2.95, $2.914, $1.856,$1.89-$1.856
Major Resistance: $3.307 $3.392, $3.487, $3.527–$3.563

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Prices Testing Lower Range

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Go into the expectations in the Weekly section bu suffice to say, that prices are likely to continue in the recent range that was discussed last week but mentioned again in the Weekly. Prices are starting the Sunday trade lower — so expect a decline lower to the Support zone.

Major Support:,$2.727-$2.784, $2.648, $2.39, $2.35, $2.112,
Minor Support : $3.167, $3.00-$2.95, $2.914, $1.856,$1.89-$1.856
Major Resistance: $3.307 $3.392, $3.487, $3.527–$3.563

Lack of Commitment

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January rallied nearly$ .50/dt…where it failed again at its 40 – day SMA and just short of the November high ($3.559 v$3.563). Prompt gas traded a range of $.490 between Tuesday and Thursday with January closing $.02 above its opening for the week ($2.280 v$2.260). For the second time in three weeks that prompt gas has closed a few ticks higher than it opened, continuing the interpretation of an indication of indecision.

Average daily volume spiked…with an estimated 3.85mm contracts changing hands (v 2.41mm last week). Increasing volume as price works higher is technically constructive.

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Storage Release Brings Bulls Out

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Not sure that the bullish storage release changes perceptions but it is clear that the withdrawal caught a few off guard. Not sure if it was short covering as the CFTC report does not come out until Friday and the open interest data is delayed be one day. Look for confirmation from the trade today and on the open on Monday for a longer term bullish bias.

Major Support:,$2.727-$2.784, $2.648, $2.39, $2.35, $2.112,
Minor Support : $3.167, $3.00-$2.95, $2.914, $1.856,$1.89-$1.856
Major Resistance: $3.307 $3.392, $3.487, $3.527–$3.563

Trying To Test Resistance

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Prices decided to rally and started to test resistance before the storage release tomorrow. Perhaps some folks have an idea of what is coming. Not sure — I don’t and can only relate that the recent rally in nat gas could be related to the overall strength of commodities as the weather is not supportive to this level.

Major Support:,$2.727-$2.784, $2.648, $2.39, $2.35, $2.112,
Minor Support : $3.167, $3.00-$2.95, $2.914, $1.856,$1.89-$1.856
Major Resistance: $3.307 $3.392, $3.487

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