Category: Weekly Detail

Storage Release Breaks Old Support

Weekly Continuous

While the support zone between $3.00 and $3.05 had held the market for the previous couple of months, it was no match for the selling that came in after the storage release. Rather than hold that support…and bounce as expected, prompt gas fell to test the continuation post Memorial Day lows ($2.857 – $2.859, 05/26 & 05/27. This year the pre Independence Day high traded on 06/26 at $3.441. The to date post – holiday low is $2.874…a decline of .567 or 16.5%. The five and ten years average of the seasonal declines are 18.9 % and 15.26% so this years market is close to a historical tendency.

While there have been years that prompt August traded steadily lower for all, or almost all, of its tenure as prompt…’24 is the most recent example (and the only example of the last ten years). Far more often August trades a post – holiday low between the 10th and 20th…even in ’24 the low before the three day bounce, before closing the month lower.

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Range Trade Supports a Break Eventually

Weekly Continuous

Prompt gas and the August contract remain confined in an increasingly well – defined trading range between $3.000 – $3.050 and $3.375 – $3.440. Friday’s last trade, $3.245 was just about exactly in the middle of that range, Thursday’s close, $3.196 just south of the middle. Recently discuss the seasonal tendency bracketing Independence Day . Currently, prompt gas has declined .290 from the 06/26 pre -holiday high ($3.441 – $3.151) or about 8.5%. While that percentage decline is greater than the declines in ’19 or ’21 it is well short of the three, five and ten years averages (15.3%, 18.9% and 21.6%, respectively). Typically, August gas continues to feel the seasonal pressure when trading resumes before a post – holiday low most often traded between the 10th and the 20th.

The consensus of technical indicators remains neutral, as it did for the entire second calendar quarter. A close above the 40 – weeks SMA and the March/June highs with supporting volume would trigger positive agreement of the indicators. A close below well – defined support between +/- $3.00 and $3.05 would, at a minimum, introduce a strong price negative bias. The weekly MACD, my primary “lagging” indicator, remained positive. The daily MACD, the weekly and daily RSI are all neutral. Given that since May 28th prompt gas has been confined in daily closing range between $3.087 and $3.343, the neutral configuration of sensitive mathematical indicators makes sense. Market internals are also neutral with the suggestion of a price negative bias. Average daily volume fell by more than 20,000 contracts as prompt August traded in narrow range. Open interest increased 43,000+ contracts…which suggests that commercial hedging may be coming in at a lower price level. The total range traded this week was .177, leaving the weekly ATR at .260…that is more than a nickel lower than the August ’25 low…getting closer to a red flag zone. The daily ATR fell to .135. The violated trend line from the ’24 – ’25 lows should be expected to present resistance…as it has for the last couple of months. The value of the trend line for calendar July is $3.360.

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New Prompt — Same Range — So Far

Weekly Continuation

July has traded the high of its tenure three times in the last ten years just before going to settlement, ’16, ’21 and ’23. Of those three ’23 is most similar to current conditions, but in all three…even in ’21 with prompt gas in a defined uptrend, settlement on the last day of June was $3.373, the calendar August low $3.734. Notwithstanding its well – defined uptrend, the gas market spent most of the summer consolidating before extending a rally into Q4 (in ’23 that high traded during October). July ’26 settled $.191 higher than June ($3.231, the highest settlement since February v $3.040) as expected.

August gas has been range-bound since the last trading day of March…between +/- $3.000 and $3.410 – $3.430. The April and May lows of August gas, $2.974 and $3.001, together with the June low, $3.059 should provide substantial support. Higher monthly lows are technically constructive but expect August to remain confined (with slight expansions due to potential weather implications) in a range similar to July.

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Nothing Technically New

Weekly Continuous

While traveling over the last few days and during the weekend, I realized that there is nothing new about the range and any other aspects of the market so while I have internet while driving — will recommend to play the range.

Major Support: $2.640-$2.57
Minor Support/Resistance : $2.87-$2.84, $3.16-$3.148, $3.136, $3.02-$2.97
Major Resistance: $3.35, $3.486-$3.494, $3.567, $ 3.736

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Not Much To Write

Weekly Continuation

Another quiet week in a market that seems very content to stay in a range. The consensus of technical indicators is neutral. The technical indicators have now been neutral for fifteen of the last sixteen weeks. That’s pretty typical for the consensus during the construction of a trading range. A close above the 40 – weeks SMA with rising supporting volume would trigger positive agreement of the indicators. A close below the trend line rising from the April and May lows would likely result in negative agreement.

The weekly MACD, our primary “lagging” indicator, remained positive while the daily calculation is negative . The weekly RSI is neutral – negative. After stalling at a lower higher ten days ago the daily RSI is neutral. Market internals have been mixed for four straight weeks. Average daily volume was higher as the prompt fell…a technical negative, but on the other side -open interest fell 31,000 + as the prompt fell…a technical positive. Last week the total range traded was about half of the week before. This week that range continued to contract, from .297 to .218. The weekly ATR fell to a lower low .311 v .328. While it has not always been so, that is considered at least neutral. The daily ATR increased from .148 to .153

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Seasonal History Remains

Weekly Continuation

Soon to expire June extended its rally to test the continuation 20 – weeks SMA (and its own 20 – weeks average) before reversing lower from an historically consistent mid – May pre Memorial Day high. In eight of the last ten years that short – term seasonal high traded between the 12th and 23rd. Last year the pre – holiday high printed on the 12th (Memorial Day was the 26th) this year on the 20th (Memorial Day is on the 25th. A lower weekly close…after opening above last week’s high ($2.994 v $2.982) with a volume increase (average daily volume increased nearly 70,000 contracts) and a closing short – term uptrend violation indicates that prompt gas will be offered lower before going off the board on Wednesday. Following June expiration the new prompt almost always falls toward a late May/early June low before a rally (which more often than not peaks either side of 06/15 and can be, historically, more often than not the Q2 high.

There is little reason not to believe that prompt gas is likely to continue to adhere to seasonal patterns/tendencies as it has since the blowoff into February expiration. It has been suggested that gas is in the process of constructing a trading range between +/- $2.50 and $3.25 – $3.50 and may continue for much of the remainder of ’26. Gas may test either side of that range while premiums awarded to deferred and distant deferred contracts diminish.

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Bias Change Receives Some Confirmation

Weekly Continuation

Trade during May is an example of a price supportive seasonality that historically emerges during Q2. Prompt gas had closed above the April high during May in 16 of 20 years. On a continuation basis prompt gas closed below its 50 – day SMA every day since 01/29 (the first day of March’s tenure as prompt)…until Monday 05/11. On Friday the June contract followed suit, closing above its 50 – day for the first time since 03/12.

Although occasionally June rallies into expiration (’18 & ’22), typically during May the prompt trades to a mid – month, pre Memorial Day high. In eight of the last ten years that short – term seasonal high traded between the 12th and 23rd, before a decline through the holiday to an end of May – first week of June low. A year ago the May high traded on 05/12, the post – Memorial Day low was a little earlier than usual, on 05/28 (Memorial Day was the 26th).

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Still Churning

Weekly Continuous

This week looks a lot like last week in terms of technical insights. The consensus of technical indicators remains neutral for the third week, before that it was neutral for seven of eight weeks. Typically, the consensus will remain neutral when prompt gas is attempting to define a trading range, with a bias that fluctuates between positive and negative. Despite incremental improvement there is no discernible bias at present.

Market internals, volume and open interest, were neutral. Both increased with prompt gas little changed for the week. The view is that increased open interest while a short – term trade range is defined suggests accumulation ahead of a Q2 rally.

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Trying to Turn to Seasonal Bias

Weekly Continuous

During calendar April the May contract closely followed the tendency to weaken into the period immediately before settlement. May ‘26’s lower low on the last day of its tenure before a modest recovery most closely resembles 2024. May ’24 traded to $1.482 (which in that case happened to be a perfect test of the March Q1 low at $1.481) before going off the board at $1.614.

Similar to this year volume was drying up…suggesting that prompt gas was constructing a significant low, but there was a notable difference in the premium afforded to the new prompt. June ’24 opened its first day as prompt at $1.923, leaving an “expiration” gap between $1.628 and $1.916. This year the gap is $2.578 – $2.592. That difference likely says something about fundamental expectations but I have no clue.

A purely technical view of the spring of ‘24 is that June’s premium enabled it to close above the March high on its first day as prompt, this then became support. This year prompt June is looking up at, and Friday began to test resistance presented by the March ‘26 low ($2.803 v June’s post expiration high of $2.821 and close of $2.780).

The takeaway may be that the gas market traded a traditional spring low coincident with May expiration as it has in a number of other years …expect something similar to those other years during spring and early summer ’26.

With the assistance of June’s premium, prompt gas traded an “outside” week reversal higher and ended the week above last week’s high. Reversals from lower lows have long been the gas market’s preferred method of communicating that an unsustainable low had been traded…the fly in that ointment is that the volume to confirm that reversal was miss.

Given the expectation of seasonal strength but the lack of volume prompt June will likely discover sponsorship well above the May expiration low while trading sideways to a little higher for most of its tenure as prompt.

A week ago, the consensus of technical indicators improved back to neutral (where it had been for seven weeks) after one week in negative agreement for the first time since the decline to the Q3 ’25 low. This week the consensus continued to improve.

Last week the primary momentum indicators, the weekly calculations of the MACD and RSI were in negative agreement. This week there is no agreement. The “lagging” MACD is negative for a thirteenth week. The “leading” RSI improved to positive without ever reaching its extreme zone. Daily calculations ended positive…the RSI after closing with an extremely oversold reading, the MACD turned higher with the potential bullish momentum divergence mentioned in the last couple of weeks.

Market internals, have gradually improved over the last two weeks were mixed. Volume fell a little week over week, but that decline can be attributed to only 252,472 contracts changing hands as May traded to a lower low before going off the board. Even with that, average daily volume of +/- 356,500 contracts was only about 4,500 lower.

Major Support: $2.640-$2.57
Minor Support/Resistance : $2.87-$2.84, $3.16-$3.148, $3.136, $3.02-$2.97
Major Resistance: $3.35, $3.486-$3.494, $3.567, $ 3.736

Price Headed to Lows Into Expiration

Weekly Continuous

Prompt gas traded deeper into a zone of mathematical support derived from the decline from the February expiration high and has done so by closing lower in six of the last seven weeks (the only exception was week ending 03/27 when prompt gas closed unchanged from the previous week)…and on a continuation basis twelve of the fourteen weeks since prompt February printed $7.827 before going off the board at $7.460. That persistent decline has left the gas market oversold and approaching but not yet closing into its historical EXTREME zone and 26.7% below its 40 – weeks SMA.

A week ago, the consensus of technical indicators, which had been neutral for seven weeks with a fluctuating bias, was negative for the first time since the decline to the Q3 ’25 low. This week with prompt gas falling to the lowest weekly close since August ’24 the consensus improved, back to neutral.

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