Category: Daily Call

Seems the market wants to digest it positioning here as it heads into a light holiday trade weekend. One of the lightest volume days of late. My positioning has not changed will be buying any dips in winter contracts, trying to offset the volatility that may occur in the prompt month. Want to wish you all a great Independence Day celebration as I will not be posting a Daily tomorrow.

Major Support: $6.245, $6.02
Minor Support: $6.19-$6.175
Major Resistance:$6.684, $7.005, $7.66, $7.725, $7.816, $7.955

Not sure how to qualify that expiration– prices declined during the beginning of the process– only to find strength the last two days — was the expiration well bid — I would suggest that 10% gains off of the lows signifies a well bid situation for the 16th consecutive month but the strength only took prices back to where they started– so you can’t call it a rally into expiration. Perhaps I will refer to it as a 15+ month trend. What is left for the August contract to take over as prompt and with the recent rebound, perhaps a slight extension of the recent gains. One element is a given — open interest continues to decline (expiration partially responsible) so the potential for volatility is great.

Major Support: $6.245, $6.02
Minor Support: $6.19-$6.175
Major Resistance:$6.684, $7.005, $7.66, $7.725, $7.816, $7.955

The break down last week had serious technical ramifications (discussed in the Weekly Section) but clearly the close below the major support area bodes for additional declines. The only issue with that is the 15 month trend for expiration being bullish– can prices rally above $6.884 (five day open) to keep that trend securely in track but any serious rally up to the $6.60 will keep the trend open for discussion.

Major Support: $6.245, $6.02
Minor Support: $6.19-$6.175
Major Resistance:$6.684, $7.005, $7.66, $7.725, $7.816, $7.955

Volatility game on big time and prices are selling rallies — does define the end of the bull run since the fall of 2020– no. Does it show the conclusion of the run in 2022 — not sure. Have we finished the expiration process and 15 month trend — not even close– three trading days left and need I remind anyone of the February expiration that sent prices to the first test over $7.00 during the process. Technical damage has occurred this week to the run but prices closed yesterday in that key area between the early April low and early May low (see chart below).

Will get into more assessment of the break down on this chart over the weekend if it occurs.

Startled that the declines never seriously tested the major support from early May and April ($6.50-$6.42) before finding support again and challenging the $7.00 zone. A couple of you have asked what I consider the expiration process — when I was trading cash and futures the 3-day close (setting up the Indices for the month) and what found out was that time period ran into some “issues” by the industry players. Now I look at the last 5 days of trade to watch for trends. Continue to rely on the 15 month trend of the prompt month rallying during the process. It is a trend until it isn’t. Should the trend break — still waiting for serious test of support.

Major Support: $6.426
Minor Support: $$6.60, $6.245,
Major Resistance:$7.66, $7.725, $7.816, $7.955

Long weekends with Sunday and Monday trading coming into Tuesday are always hard to interpret and this last weekend is no different — with prices off hard on Sunday and Monday only to find some buyers yesterday– supporting the move. After the recent collapse, do price consolidate for a day or two (which would be my expectation) or do they continue the declines. Went into the key area for support on the Weekly section, so I will not re-hash that here as the market is playing with key level for the rest of summer and the expiration trend of the last 15 months.

Major Support: $6.426
Minor Support: $$6.60, $6.245,
Major Resistance:$7.66, $7.725, $7.816, $7.955

The last 15 expiring monthly contracts have been well supported into expiration after trading a low near the middle of the month (most of those lows have traded between the 15^th and 21^st but have traded as early as the 10^th and late as the 25^th).  July ’21 traded its expiration low on 06/21.  Expect July ’22 to continue that tendency.  Prices softened more in the light Holiday trade but the trend would suggest a low established shortly to be followed by support into expiration early next week.

Major Support: $6.426
Minor Support: $$6.60, $6.245,
Major Resistance:$7.66, $7.725, $7.816, $7.955

Forgot about the Holiday and not cash trading anymore was not reminded until I noticed the exceptionally light volumes for even a Sunday night- Will not be updating the Weekly section during today Monday as I will attempt to celebrate the Holiday. For now all I can say for those trading is expect a test of the major support for this last launching point for the current bull market at $6.4266 (see chart below). This chart will be key in my Weekly report coming tomorrow.

Major Support:$7.36, $7.21, $6.426
Minor Support: $$6.60, $6.245,
Major Resistance:$7.66, $7.725, $7.816, $7.955

Suggested in yesterday’s Daily that you may want to take a day to observe, which turned out to be wise. Prices rebounded over 40% before calming into a range trade between $7.40 and $7.60 for the majority of the day. The market seems to want to develop a range trade, but not sure a storage release will provide that type of environment to develop.

Major Support:$7.36, $7.21, $6.60
Minor Support: $$6.60, $6.245,
Major Resistance:$7.66, $7.725, $7.816, $7.955