Category: Daily Call

Guess a day or two of declines, mitigating the extreme over bought indicators, met the market expectations for higher prices in the longer term. Nothing has change from the fundamental side (except for comments from Russia) from the highs traded last week. Now back in the extreme zones on the Weekly charts but still reasonable from the Daily chart. I would expect further gains and I need to adjust my high side of the range trade (discussed yesterday) to $6.00 as the market has shown discomfort in closing above that level.

Major Support:$5.416, $5.341, $5.17, $4.88, $4.61, $4.537,$4.375, $4.211, $4.156, $3.92, $3.821,
Minor Support: $4.728-$4.70, $4.66
Major Resistance: $5.63- $5.68, $5.876, $6.24-$6.49

The consolidation pattern continued yesterday to a point of support, though not quite hitting it then rebounding back up to a higher daily close. The rebound put prices back in the extreme momentum levels on the Weekly charts, but the week is not over– so trade with caution. This looks to be a potential struggle as the market was running on expectations (Europe, Great Briton and the US) of limited supplies to replenish storage by the end of the month and going into winter short. Nothing on that side of the ledger has changed to my knowledge (fundamental information limited at best) so I am going to guess that volatility will be gaining and the market will be a series of gains and losses until some additional fundamental data comes to fruition. From the technical standpoint this is set up as a range trade between $5.63 and $5.15.

Discussed last week about the recent trend of rallies at the first of the week (4 of the last 6) but now we have an opening coming off a lower weekly close which is a first in the last six weeks. It will be interesting to see how the market reacts, especially coming of the declines late last week. Those declines would suggest a weak opening but the early trade Sunday night, have some slight strength. Still waiting for some consolidation or declines to soften the extremely over bought condition.

Major Support:$5.416, $5.341, $5.17, $4.88, $4.61, $4.537,$4.375, $4.211, $4.156, $3.92, $3.821,
Minor Support: $5.62-$5.633, $4.728-$4.70, $4.66
Major Resistance: $5.876, $6.24-$6.493

Thought maturity in the market had arrived — little did I know that the teenager was in the wings waiting to stretch its legs taking the trading range over $.50 and blowing through the $6.00 level. Some of you have contacted me about selling some of the hedges we set into position last summer and spring— I can not recommend selling anything into this run until the market sends some signals that the silliness is going to end. Reasons for that center around the potential of Henry Hub running up to $8-$10 before this run is over. There will be corrections taking price down for a day or two, but the over-riding trend is (has been) strength. So unless you want to actively manage (sell and buy back) your hedge positions– stay back and work on other more pressing issues. Did I mention– winter forecasts have not yet been priced into the action.

Major Support:$5.416, $5.341, $5.17, $4.88, $4.61, $4.537,$4.375, $4.211, $4.156, $3.92, $3.821, $3.722,
Minor Support: $4.728-$4.70, $4.66
Major Resistance: $6.24-$6.493

I know this is a reach but the market actually showed some signs of maturity– after ripping upward over $6.00 it, again retraced rather than hold the gains. At $4 and $5 once it ripped up the chase was on. Perhaps my need to see some consolidation is clouding my vision that prices will just continue to jump leaps and bounds– but the trader in me has seen many of these events since 1991 and if they don’t build orderly — then it gets ugly real quick.

Major Support:$5.416, $5.341, $5.17, $4.88, $4.61, $4.537,$4.375, $4.211, $4.156, $3.92, $3.821, $3.722,
Minor Support: $4.728-$4.70, $4.66
Major Resistance: $5.93, $5.88-$6

Prices opened higher Sunday night – so expect the trade to follow four of the last six Monday’s with stronger prices. Explained some of the recent trends in the Weekly section, so I suggest a quick read. Where do prices go— I would guess somewhere between $6.00 and $5.17 in the near term. Many fundamental reasons are spurring this radical trade of the last few weeks — how does that turn out — no clue. Technical data points suggests that consolidation and calming (discussed last week) will need to occur to support further significant gains in the fourth quarter.

Major Support:$5.416, $5.341, $5.17, $4.88, $4.61, $4.537,$4.375, $4.211, $4.156, $3.92, $3.821, $3.722,
Minor Support: $4.728-$4.70, $4.66
Major Resistance: $5.93, $5.88-$6.493, $6.318

The daily ranges for the four trading days this week are $.675, $.653, $.678 and $.534– one flat, one down and two up. This daily range is not sustainable over extended periods of time. It is that reason for my column yesterday that the Nat Gas market needs to chill. It did not happen (as I suggested yesterday) with a storage release — but the release didn’t effect prices at the time of the release but provided a base for prices to run on. Does it chill today — I will not try to guess, not going to short this rally but will be taking some profits if it gets too silly. Prices remain in the extreme over bought zones on almost all momentum charts.

Major Support:$5.65, $5.17, $4.88, $4.61, $4.537,$4.375, $4.211, $4.156, $3.92, $3.821, $3.722,
Minor Support: $4.728-$4.70, $4.66
Major Resistance: $5.93, $5.88-$6.493, $6.318