Natural Gas Forecast December 20, 2012, Technical Analysis

Natural gas markets initially rose during the session on Wednesday, but met massive resistance at the gap that had been broken through previously. This corresponds with the $3.50 level, and it makes sense that heavy resistance would be found at that large round psychologically significant number. We still believe in the downside in this marketplace, and as a result are willing to sell this market as it breaks lower because it shows significant bearishness below that level. We think that the $3.00 level will be tested eventually, and as such are looking to not only sell a break down, but sell rallies and show any signs of resistance as well.