NATGAS breaks back above 200-day moving average
Henry Hub Natural Gas (NATGAS) Technical Analysis Report for Oct 26, 2020 | by Techniquant Editorial Team
NATGAS ended Monday at 3.243 gaining $0.073 (2.3%) on low volume. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (NATGAS as at Oct 26, 2020):
Monday's trading range has been $0.134 (4.22%), that's below the last trading month's daily average range of $0.173. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for NATGAS.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bullish Outside Bar. After moving lower in the prior session, the market managed to close higher but below the previous day's open, forming a bullish Harami Candle.
Natural Gas managed to close back above the 200-day moving average at 3.171. Prices are trading close to the key technical resistance level at 3.325 (R1). After having been unable to move lower than 3.166 in the prior session, the contract found buyers again around the same price level today at 3.159. The last time this happened on October 22nd, NATGAS actually lost -2.64% on the following trading day.
Nat Gas shows strength in the short-term supported by its long-term uptrend with only the medium-term trend being bearish.
Buying might speed up should prices move above the close-by swing high at 3.362 where further buy stops could get triggered.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Outside Bar" stand out. Although it is usually interpreted as bullish, it has actually shown to be bearish for Natural Gas. Out of 119 times, NATGAS closed lower 59.66% 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 53.78% with an average market move of -0.52%.
With four out of the other seven Commodity Markets closing lower today, the ones that stand out on the negative side are CRUDE losing -2.95% and WHEAT closing -2.34% lower. On the flipside the best performers have been COFFEE closing 1.2% higher and SUGAR gaining 0.34%. Read more