Monday, November 22, 2010

Natural Gas Update

If you are interested in the backstory here is
Natural Gas Review  from June 8, and 
Natural Gas /Seasonal Lows from Aug 29

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The rally off the seasonal low has been rather difficult to count, with sharp reversals and abc's so far being the pattern. This can be indicative of merely corrective moves, however for reasons stated in above links, the rally likely has further to run even though it is structured in abc's.
If the next series of abc's were to equal the first "a" it will target roughly 4.80. Additionally the move up is 50% of the 2.40 to 6.11 move at 5.07. Please note the horizontal resistance at the 5.00 level.
So 5.00 +/- .10 will be closely watched.

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Shorter term the 50% pullback of the -3- wave ought to contain the -4-, and an overlap of the 1, at about the same level, would raise red flags on the bullish count above.

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