Category: Daily Call

Expect Additional Tests of Support

Daily Continuous

Last week provided the initial test of support and declining in the normal post Independence day fashion– now lets see what the low end of this trading range is as last week provided solid tests of several levels (see Weekly section). The high end of the July range has likely been established with last week’s high– but that is not written in stone.

Major Support: $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support:$2.52-$2.47, $2.38-$2.26, $2.17
Major Resistance $2.816-$2.836, $3.00, $3.536, 3.59

Declines Continue Testing Support

Daily Continuous

Prices declined to test last week’s low at $2.61 but found some buying the big area if the bears want some action is around $2.52 then from $2.52-$2.448. We shall see — volume doesn’t look like it is supporting the declines in a meaningful way.

Major Support: $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support:$2.52-$2.47, $2.38-$2.26, $2.17
Major Resistance $2.816-$2.836, $3.00, $3.536, 3.59

Bears Test the Downside For Now

Daily Continuation

The bears seem to control the early morning and therefore the trade day direction as they waved off the forecasts for demand and started selling, taking prices to the short term support area. There is a lot more trade to July than this early move indicates (see Weekly). For now– I see higher lows and a change in bias — so I will add on the dips.

Major Support: $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support:$2.47, $2.38-$2.26, $2.17
Major Resistance $2.816-$2.836, $3.00, $3.536, 3.59

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Early July Trade Has History

Daily Continuous

Not sure why prices were down on the early trade on Monday — lack of volume and folks trading likely the culprits. The short term weather had significant demand that will start to show the power demand expected this summer and the potential impacts on storage balances. Went into the medium term impacts for gas in the Weekly section as well as some historical flavor for what happens in July trade. Not convinced that the upcoming week will challenge the $3.00 area, but technical indications are that is a matter of time.

Major Support: $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support:$2.47, $2.38-$2.26, $2.17
Major Resistance $2.816-$2.836, $3.00, $3.536, 3.59

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Quiet Start to the Trade

Daily Continuous

Not much to say about the trade yesterday except that the number forced some shorts to cover– set the high for the day and then wallowed around on light volume. Light volume not surprising going into the holiday week. Looks like folks in the northeast are having troubles leaving for the holiday and judging from the trade — some may be nat gas traders. Speaking of leaving — I will not be providing a Daily on Monday and the next Daily will be on the 5th of July– have a great Independence celebration with your families.

Major Support: $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support:$2.47, $2.38-$2.26, $2.17
Major Resistance $2.816-$2.836, $3.00, $3.536, 3.59

Aug Now Rules July Trade

Daily Continuous

It was good to see the August contract come back to the July expiration — so we don’t have to discuss that convergence. Now we get a storage number on the heels of a fairly aggressive fundamental demand week according to some of my fundamental traders. Still range trading between $2.47 and $2.80 — so pick your side.

Major Support: $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support:$2.47, $2.38-$2.26, $2.17
Major Resistance $2.816-$2.836, $3.00, $3.536, 3.59

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June Rolls Into July

Daily Continuation

The July contract has had a hard time pushing the envelop higher beyond the $2.80 area and once again, got altitude sickness yesterday. No worries, as the August contract will be taking over after tomorrows expiration and is likely to challenge the $3.00 selling zone.

Major Support: $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support:$2.47, $2.38-$2.26, $2.17
Major Resistance $2.816-$2.836, $3.00, $3.536, 3.59

Hangin on the High End of Range

Daily Continuous

Don’t believe we are going to get a solid test of the late Feb high over $3.00 during the expiration process. The market should test that level during calendar July. Play the recent range leading into the Aug take-over.

Major Support: $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support:$2.47, $2.38-$2.26, $2.17
Major Resistance $2.707, $2.816-$2.836, $3.00, $3.536, 3.59

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A New Game Has Emerged

Daily Continuous

Go into more specifics in the Weekly Section, but sentiment has changed in the gas market–yes prices are low compared to the last year but the near term has a more bullish bias to it than it did a month ago. A lot of the buying last week was mostly short covering (open interest declined 57,000 contracts — Thursday to Thursday). I do not need to remind you that short covering is great for a short term rally but not indicative to a long term that will take prices higher over time. Stay tuned this week, to see how the market responds to expiration and the recent short covering.

Major Support: $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support:$2.47, $2.38-$2.26, $2.17
Major Resistance $2.707, $2.816-$2.836, $3.00, $3.536, 3.59

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Consolidation Confirmed

Daily Continuous

Informative trade as the storage report punished prices but prices rebounded from the lows. That would qualify as a confirmation of the range being established for the short term. Play the range from the lows of the week to the highs of the week.

Major Support: $2.00, $1.991-$1.96, $1.795-$1.766
Minor Support:$2.47, $2.38-$2.26, $2.17
Major Resistance$$2.685, $2.707, $2.816-$2.836, $3.00, $3.536, 3.595

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