NATGAS closes within previous day's range after lackluster session
Henry Hub Natural Gas (NATGAS) Technical Analysis Report for Sep 15, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, NATGAS finished Tuesday at 2.357 gaining $0.054 (2.34%). Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (NATGAS as at Sep 15, 2020):
Tuesday's trading range has been $0.108 (4.69%), that's below the last trading month's daily average range of $0.134. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for NATGAS. Prices continued to consolidate within a tight trading range between 2.246 and 2.399 where it has been caught now for the last three trading days.
Natural Gas managed to close back above the 200-day moving average at 2.356 for the first time since September 9th. When this moving average was crossed above the last time on September 9th, NATGAS actually lost -3.34% on the following trading day. Prices are trading close to the key technical resistance level at 2.411 (R1). After having been unable to move lower than 2.284 in the previous session, the contract found buyers again around the same price level today at 2.275.
The market shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying could accelerate should prices move above the nearby swing high at 2.399 where further buy stops might get activated. Selling could speed up should prices move below the close-by swing low at 2.246 where further sell stops might get triggered.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Higher Closes" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for Natural Gas. Out of 322 times, NATGAS closed lower 57.76% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 59.63% with an average market move of -0.74%.
With five out of the other seven Commodity Markets closing lower today, the ones that stand out on the negative side are WHEAT losing -1.6% and CORN closing -0.75% lower. On the flipside the best performers have been CRUDE closing 2.99% higher and SUGAR gaining 2.58%. Read more