US Natural Gas COT Report February 13, 2015

The Composite US Natural Gas Futures and Options combined as of February 10, 2015 shows a Total Open Interest of 3,906,030 of which Managed Money is long positioned with 365,330 contracts and short positioned with 415,345 contracts makes a net short exposure of 50,015 contracts. We can see a long liquidation of 10,816 contracts and an increase in short positions by 8,261 makes Money Managers net sellers of 19,077 contracts in the week ended February 10.

Source: COT Reports

Natural Gas Market Analysis

All information is for educational use only and is not investment advice. There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.

This is an educational top down technical market perspective on Natural Gas. Looking at the monthly bars chart, we can see that this month opened in the middle of the balance area and took out the previous month's low. The market trading below this balance area now and moving forward to the next potential bullilsh support area that actually hold two months ago. Also, we can observe how the previous month got rejected from the last bracket area.

The previous week's low got taken out at the first day on this week and we are testing currently a potential support area. We'll see how the market will will react to this level now. The outside bar four weeks ago was the first heads up for a probable change in trend direction. This was followed by two inside weeks and the previous week finally took out the outside bar's low and closed below its range.

With a more bearish view we are moving forward to the daily bars chart. This timeframe one time framed lower since six days and left behind a gap area that could be a possible area to revisit. Friday's market took out the high from Thursday but closed inside of Thursday's range, so actually it was not a sign of change in trend. Anyway, today the previous low got taken out and the bearish trend remains. The next potential support area is marked on the chart.

Also interesting to mention on this daily timeframe was the nice support at the 61.8% Price Retracement level as well as the support at 50% level on the second test.

Looking at the weekly and daily timeframe with installed EMAs, we can see that the market is trading below the short-term EMAs as well as the long-term EMAs on both periodicities. Today's market for example opened around last week's average, so the probability of more selling occurring was high.

Let's take a look on the Regular Trading Hour's (RTH) TPO profile. We can cleary see a Double Distribution profile with an open gap area in the middle of last week's range. The previous week's low got taken out and the market left behind a unsecured high in the current profile.

Today's market opened inside of Firday's range and in the upper distribution area (ETH TPO Profile). All the day the market moved continuously lower and cleard Friday's unsecured low as well.

We hope you've enjoyed this quick educational market analysis recap. Stay happy and think simple!

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You want learn more about our Trading Methodology?
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Natural Gas Top Down Market Analysis

All information is for educational use only and is not investment advice. There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.

Welcome to our quick educational Top Down Market Analysis for Natural Gas. We are beginning with the monthly bars chart. We can identify a somewhat of balance area here after we broke the upper bracket area. The new month opened far away form last week's close.

Let's zoom in to the weekly bars chart now. The new week opened with a gap up and we are inside of the weekly balance area. Test of the balance area high should be probable. We'll see what will happen there. Last week has ended the three week one-time-framing down market with an outside bar. The outside bar was a first heads up for a potential change. Actually we took out this week's high with this gap up now.

We are also opened above the short term trend EMAs 5, 10 and 20 installed on the weekly bars chart.

Moving forward to the daily chart we can observe a five day one-time-framing market including today's gap-up day. Also, we are far away form the short term trend EMAs.

Gap days tend to be rotational, this means we are lean us on the value extremes like DVAH and DVAL to trade from one extreme to another until we break out of the range. We can nicely observe this behavior on the intra-day VWAP from today.

Be careful to trade this market on a intra-day perspective but it is great for analysis purposes to understand the higher time frame story and to improve the feeling of identify the path of least resistance. Sometimes it is great to play around with some other markets to sharp our senses with our analysis tools.


Stay happy!

What is VWAP, VAL, VAH, Bracket etc?
Take a look into our Trading Glossary.

You want learn more about our Trading Methodology?
Visit our community site or website to learn more about how we trade day-to-day. With an elite membership for example you can read some more indepth educational analysis posts and download our chart templates for Sierra Chart and NinjaTrader.