Category: Daily Call

I have been expecting the bears to make a push against the gains and formulate a decline to support– May have been all wrong and the market is consolidating the gains from expiration this week– potentially setting up additional gains. The storage report was bearish (as expected) compared to the averages and last year– but the market hardly flinched. Going to work the support levels for a consolidation phase going into next week – stops tight as not totally committed to the theory.

Major Support: $2.00, $1.795-$1.766
Minor Support: $2.41- $2.34
Major Resistance$2.836, $3.00, $3.536, 3.595

Not sure that decline to the high side of the expiration process from last month — but it is what it is. Would of preferred a more dominant decline but it is a start. The storage report may provide the required strength to test support levels into the $3.35-$3.45 zone.

Major Support: $2.00, $1.795-$1.766
Minor Support: $2.41- $2.34
Major Resistance$2.836, $3.00, $3.536, 3.595

As expected, the bears got a little to far out over their skis and prices bounce off of the sub $2.00 low. Shocking — as the late coming bears (in the March contract) got gutted in the expiration process. Hard to announce that the reversal (as close as it comes to being an outside week reversal) has happened but a series of higher lows in the daily trade will be the confirming piece of information. Events like last week (see Weekly section) are usually the gas markets favorite way of announcing a bias change but it will need to confirm.

Major Support: $2.00, $1.795-$1.766
Minor Support: $2.41- $2.34
Major Resistance $2.61, $2.657, $3.536, 3.595

Well the Puts are safe and now how far is this expiration run going to take prices. Mentioned over the last week or so about the short covering event that will be coming to the market– we are witnessing the short covering in the March contract — how far does this take remaining contracts is anyone’s guess. Dipping into the summer contracts has started showing some returns.

Major Support: $2.00, $1.795-$1.766
Minor Support: $2.41- $2.34
Major Resistance $2.61, $2.657, $3.536, 3.595

My apologies– I expected the bullish response on options expiration day not the day before– regardless the market for the first time in four weeks, found buyers and fewer sellers, allowing prices to rally on the day. Not surprising behavior based upon all the selling that has been occurring over the last few weeks. Not sure what the March contract does over the next two days — but I am sure I won’t be playing in that pool. I have been dipping into the summer months, now that winter has been defined. Will look at each summer chart and look for good levels to buy, considering the blood letting that has been going on since December.

Major Support: $2.00, $1.795-$1.766
Minor Support:
Major Resistance$2.34, $2.61, $2.657, $3.536, 3.595

There may be some excitement coming as the decline’s have taken prices to the $2.00 area which is a very large position in open interest. The break down through the level will take March considerably lower and the puts are forced to cover. Best idea from here is to sit on the sidelines — let this extreme over sold movement conclude as it seems more about the decline in general rather than fundamental input.

Major Support: $2.00, $1.795-$1.766
Minor Support:
Major Resistance$2.34, $2.61, $2.657, $3.536, 3.595

Nothing more to be said that when a market breaks support and ends up down for the eighth week of the last nine, closing on the lows — well it just doesn’t get any more bearish for prices the next week. Sure enough, when we opened Sunday and through the light trade day, prices moved lower. Discussed in the Weekly about thoughts on the market forming a base / consolidating, so give it a read. How low does the record oversold market go — no clue but the risk / return on new shorts is declining each day.

Major Support: $2.238-$2.22, $2.00, $1.795-$1.766
Minor Support:
Major Resistance$2.34, $2.61, $2.657, $3.536, 3.595

Over the last 10 trading days the market has traded in a $.35 range and have little or no interesting in breaking out or down. Where is the love (especially considering the time of the month). What are we going to do here? Discussed in the late Weekly diatribe that the market seems to be “basing” — built into that term is the concept that from this period prices rally. The other term to use is consolidation for this trade — not insinuating the upcoming move is up or down. I believe that price are consolidating but could be basing if the shorts don’t develop the power to extend.

Major Support: $2.533, $2.422, $2.238
Minor Support:
Major Resistance$2.67, $3.536, 3.595, $3.63, $3.789, $4.128, $4.22-$4.39, $4.75-$4.825, $4.948