Daily Call

Dec Testing the Low End of Range

Daily Continuous

Declines wanted to test the low side of the range that the December contract seems to be wanting develop and confirm.

Major Support:,$2.648, $2.39, $2.35, $2.112, $2.026-2.00, $1.991, $1.93 ,$1.642, $1.605
Minor Support : $1.856,$1.89-$1.856
Major Resistance: $2.727-$2.784, $3.00, $3.16

Gap Closed

Daily Continuous

Prices declined to close the gap from the expiration from the Nov contract– from there it was as solid bounce. Dec will likely develop its range in the near term. Caution trading the undisclosed range due to the record level of open interest.

Major Support:,$2.648, $2.39, $2.35, $2.112, $2.026-2.00, $1.991, $1.93 ,$1.642, $1.605
Minor Support : $1.856,$1.89-$1.856
Major Resistance: $2.727-$2.784, $3.00, $3.16

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Lows for Dec Contract Not Registered

Daily Continuation

Unfortunately there was death in my wife’s family and it will limit the writings this week. Would continue with the thoughts from last week surrounding the Dec contract to chase the gap that it was afforded at Nov expiration.

Major Support:,$2.648, $2.39, $2.35, $2.112, $2.026-2.00, $1.991, $1.93 ,$1.642, $1.605
Minor Support : $1.856,$1.89-$1.856
Major Resistance: $2.727-$2.784, $3.00, $3.16

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Weakness To Continue

Weekly Continuation

I have to apologize for the brevity of this submission, unfortunately there was death in my wife’s family and it will limit the writings this week. Would continue with the thoughts from last week surrounding the Dec contract to chase the gap that it was afforded at Nov expiration. My only caution is record level of shorts in the open interest analysis- so there will be a covering rally — just don’t see it in the imminent trade. Instead the gap from expiration gap left 10/30, $2.391 – $2.632 is the likely target for the declines.

Major Support:,$2.648, $2.35, $2.112, $2.026-2.00, $1.991, $1.93 ,$1.642, $1.605
Minor Support : $1.856,$1.89-$1.856
Major Resistance: $2.727-$2.784, $3.00, $3.16

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Quiet Before the Gremlins

Daily Continuous

Prices did little to indicate the bias for the upcoming storage release. Good time to sell some out of the money premium and see what happens.

Major Support:,$2.648, $2.35, $2.112, $2.026-2.00, $1.991, $1.93 ,$1.642, $1.605
Minor Support : $1.856,$1.89-$1.856
Major Resistance: $2.727-$2.784, $3.00, $3.16

Winter Contracts Now Rule

Daily Continuous

The declines held yesterday from the devastation from Monday’s trade and rebounded just slightly at the end. Of primary interest was the discount to the now prompt December remaining over $.50 during the meltdown of expiration. There is little technical reasons as to why Dec will not attempt to close the gap that now exists and the December contract declining to chase the lows of the Nov contract from Monday. The outstanding question will be around it being the Dec contract and expectations for weather changes going into the winter months.

Major Support:,$2.648, $2.35, $2.112, $2.026-2.00, $1.991, $1.93 ,$1.642, $1.605
Minor Support : $1.856,$1.89-$1.856
Major Resistance: $2.727-$2.784, $3.00, $3.16

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2024 Expiration Behavior Returns

Daily Continuation

Discussed the history of expiration behavior in 2024 with last month being the only exception to the weakness trend for expiration’s during the year and yesterday provided a return to the tendency. The question will be how does it behave today and what is the effect on the spread to the December contract.

Major Support:, $2.35, $2.112, $2.026-2.00, $1.991, $1.93 ,$1.642, $1.605
Minor Support : $1.856,$1.89-$1.856
Major Resistance: $2.63, $2.727-$2.784, $3.00, $3.16

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What Does this Expiration Bring Us

Daily Continuation

Mentioned in the Weekly section that each expiring contract month from February through September ’24 was “amply” offered as it went off the board. That changed last month. October traded the high of its tenure as prompt on the day it went to settlement at $2.585. Not sure what will happen with the Nov expiration but would not expect major volatility. My guess would be it is neither well bid or offered into expiration, as the market is seeking its near term commitment.

Major Support:, $2.35, $2.112, $2.026-2.00, $1.991, $1.93 ,$1.642, $1.605
Minor Support : $1.856,$1.89-$1.856
Major Resistance: $2.63, $2.727-$2.784, $3.00, $3.16

Important Expiration This Week

Weekly Continuation

The soon to expire prompt plunged to test and reverse from the 40 – week SMA. The reversal from the long – term trend defining moving average support left November $.068 lower for the two weeks but back above its August and September lows, leaving the charts with the appearance of a failed break-down.

The December contract, still commands $.532 premium over November, traded an outside week reversal. Closing higher each day this week December rallied to test its 50 – day SMA, increased its premium over the expiring prompt and ended above the high traded a week ago with expected increasing volume (due to the roll). That weekly reversal and increased premium are technical positives that are likely to play an important role for calendar November and the remainder of ’24.

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What Was That

Daily Continuous

Did not see that break out above happening– in fact due to the move on Wednesday, my speculation was some folks were trying to front run a bearish report. Well, we got the bearish report but prices didn’t decline — rather continued the ascent. With the expiration coming nest week (we know the 2024 record of declines into expiration), we have to be very cautious of this rally– it may take us to the $2.60’s — but it may provide a trap door for declines back to the $2.30’s. I will be following the differed contracts (Dec and Jan) for better insight of the near term price movement.

Major Support:, $2.35, $2.112, $2.026-2.00, $1.991, $1.93 ,$1.642, $1.605
Minor Support : $1.856,$1.89-$1.856
Major Resistance: $2.63, $2.727-$2.784, $3.00, $3.16

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