Sunday, August 29, 2010

Natural Gas /Seasonal Lows

Natural Gas is nearing targeted lows of 3.35/3.28, see  Natural Retesting .618 Retrace  from Aug.25,
Natural Gas from Aug. 10, or any of the previous Natty posts.
It is very important to note the consistent history of Natural Gas  making seasonal lows at this time of year;  last year's important 2.40 low was made on Sept. 4th.
The subsequent rally typically runs into the Nov/Dec period, and has averaged 115 % over the last 18 years.  (Walter Zimmermann)
Last year's rally went right to the very end of the year and was a gain of 153%. 
Friday's low was .27 above the minimum 3.35/3.28  target.
NOT a great time to go to the beach unless you've already placed your call spread orders.
An average rally of 115% up from 3.30 would take to it to 7.09, the .382 retrace of the 13.70 to 2.40 level is at 6.72, and an abc up equal to last years from 2.40 to 6.11 , targets 7.01 beginning from 3.30.

click to enlarge
Slight corrections are likely and not out of order right here, but taking out the trendline at this time sensitive point probably signals more to go.

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