Wednesday, October 13, 2010

Natural Gas Wave Count

Thought it might be timely.
First and foremost ; the short term (relatively speaking).
Is there a complete count down? Has that look..please see
 Natural Gas End Zone The month long trend line cuts around 3.70ish today and the 50% retrace of the last little leg down from 3.89 is at 3.716.  Note negative RSI divergence.
 Nov Daily
 click to enlarge
Some similar conditions on the daily chart; negative divergence on the RSI , and the count has a  complete look to it or nearly so.
 I believe that the 2.40 low last year represented the completion of a long term ABC structure down and we are now 1 year into a new ABC upside structure of potentially the same degree.
And finally;

The last ABC structure down took 4 years to complete, the B wave alone lasted nearly 2 years.
While this new ABC up doesn't need to equal that, .62 would take it to Dec of 2011.
The next C leg up equals last years A at 7.25 from the lows of 3.54, and C will =1.62 of A at 9.55. (I know sounds crazy, but so did a potential 1.95 target back in 2008 when NG was at 13.)

 Almost forgot. Check out the trendline on the Jan contract daily chart.


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