mikebiz

Natural Gas may be setting up for a longer term correction

FX:NGAS   Natural Gas (Henry Hub)
Weekly ngas looks like it has transitioned into an uptrend. Its not clear if this is a major change in trend or a correction. As of now, the weekly chart from the Feb 16 low looks more like an impulse wave instead of a corrective wave. However, I'm still going to look at points of resistance as if its corrective and a retrace of the 2014-02-24 high to 2016-02-29 low. I've only started looking at ngas again recently and I believe the week of 2016-08-08 would have been ideal entry with:
  • ADX above 20 and a convergence of +/-DMI as price pulled back
  • TSI and RSI pulled back before weekly price continued up

Now, the question is if weekly price will continue up or begin to hit resistance. The first area I'm watching is 3.460 so a pullback now could be a place to enter a short term long position.

Another interesting aspect of the weekly chart is that the line (orange) put in by the -DMI of the Feb 16 low has been hit once and is now set to be broken by both the +DMI and the ADX . If this happens and holds, my interpretation will be that a major trend shift is in play and will need to set plan accordingly.

Daily chart looks strong but may be pulling back. Things I'll be watching for this week is for +/-DMI to converge along with a pullback of price into the averages and a pullback of TSI and RSI into 50-60 range.

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8H/4H charts watching to see if there is a repeat pattern of a pullback including price and indicators. If this pattern occurs, may be the place to buy dec             NG             call.

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1H looks like pullback has begun and may carry through to 8H/4H charts.

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