Natural gas markets continue to be very noisy, and more importantly: range bound. Because of that, we can take advantage of the fact that we are at the top of the range and start selling. The $2.95 level has been resistance more than once, and I think it begins a major resistance barrier all the way to the $3.00 level. Ultimately, I think it’s only a matter of time before the sellers get involved on signs of exhaustion, and I would be a seller then as well. If we broke above the $3.00 level, that would be a very bullish sign and could send this market looking towards the $3.10 level above which is even more resistive.
The $2.85 level underneath has been supported, and I think it continues to support this market in the short term. I think that if we break down below there, it’s likely that we could drift down to the $2.80 level. I think that longer-term, we will see sellers jump into this market and pushing it much lower as we are oversupplied to say the least. However, I think the one thing that you can playwright now is the bank and for the nature of this market in short term moves, until we break out of this range, I don’t think that there is much to be said about a longer-term move. You certainly can take advantage of the range bound attitude though. I would keep my position size relatively small in the meantime.