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NG Weekly: Pullback To Key Support Early Week Before Minor Probe Higher To 2.02s

May 02, 2020 1:32 PM ETUNG, UGAZF, DGAZ, BOIL, KOLD, UNL, GAZ7 Comments
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Sharedata Futures


  • A pullback to 1.76s developed in Monday’s auction where an aggressive buy response drove price higher to 2.02s into Tuesday’s auction.
  • Sell excess developed there as balance developed, 2.02s-1.83s, into the week’s end.
  • The highest probability path, near-term, is sell-side, barring failure of 2.02s as resistance.
  • This week’s leveraged capital posture saw continued increase in net length.

In this article, we examine the significant weekly order flow and market structure developments driving NG price action.

As noted in last week’s NG Weekly, the highest probability path for this week was sell-side, barring failure of 1.98s as support. This probability path did not play out as an early week pullback to last week’s key support saw a buy response in Monday’s auction. Rotation higher developed to 2.02s in Tuesday’s auction, testing key resistance. Sell excess developed there, halting the rally as balance developed, 2.02s-1.83s, into Friday’s auction, settling at 1.89s.

NG Weekly Auction 24Apr20

26 April–01 May 2020:

This week’s auction saw a pullback develop in Monday’s trade as last Friday’s late buyers failed to hold the auction. Price discovery lower developed, achieving the weekly stopping point low, 1.76s, as last week’s key support was tested. An aggressive buy response developed there, driving price higher to 1.90s as buying interest emerged into Monday’s NY close. Monday’s late buyers held the auction as balance developed, 1.94s-1.88s, early in Tuesday’s auction. A buy-side breakout attempt then developed in Tuesday’s trade, achieving the weekly stopping point high, 2.02s. Sell excess developed there, halting the rally as rotation lower to 1.93s developed into Tuesday’s NY close.

Narrow balance developed, 1.93s-1.97s, early in Wednesday’s auction before rotation lower continued to 1.85s as buying interest emerged into Wednesday’s NY close. Wednesday’s late buyers failed to hold the auction as price discovery lower continued early in Thursday’s auction, achieving a stopping point, 1.82s. Buy excess formed there, halting the sell-side sequence as rotation higher resumed through the EIA release (+70 bcf vs. +69 bcf expected) to 1.95s where selling interest emerged into Thursday’s NY close. Thursday’s late sellers failed to hold the auction as a re-test of Tuesday’s high developed early in Friday’s auction at 2.01s. Sell excess developed there again before a selloff developed to 1.87s ahead of Friday’s close, settling

This article was written by

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Historical Data Mining & Visualization for NYMEX energy markets. Our experience derives from the proprietary trading world involved in US Index derivatives, commodity ETF derivatives, and exchange-traded NYMEX WTI derivatives.Futures trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones financial security or life style. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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