What does historical analysis of noteworthy United States natural gas bear marketplace moves reveal (NYMEX nearest futures continuation basis)? It generally confirms the conclusion that “the long run bear trend probably ended with the 1/23/12 low around 223” (see “US Natural Gas- There Has Been and Will Be Blood”; 1/31/12). In addition, that review also indicates a significant possibility that NYMEX natural gas will reach a second low distant in time from but close in price level to the January 2012 bottom. The most likely time for this “double bottom” is late August/calendar September 2012.
Marketplace history is never marketplace destiny. Over two decades of NYMEX natural gas history is substantial, yet it is not an extremely long period. Compare US stock marketplace benchmarks such as the Dow Jones Industrial Average or the S+P 500. In addition, definitions and identifications of bull, bear, and sideways marketplaces and their alleged trends reflect opinions. Designation of particular start and end dates for apparently notable moves likewise reflect personal outlooks.
Also, interpretation of natural gas can focus on more than the nearest futures continuation contract. One may choose to peer at individual actual contract months (as in the April 2012 futures contract), several trading months of a season (as in summer 2012), calendar years (as for the calendar 2013 strip of contracts), spreads (such as NYMEX March 2013/April 2013), and regional (basis) relationships. Insight into natural gas marketplaces and their bull and bear trends can derive from analyzing electricity, coal, other marketplaces, and assorted additional economic and political phenomena as well. In natural gas as in other arenas, supply/demand investigation can intertwine with so-called technical analysis.
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NYMEX Natural Gas- A History of Bear Trends (2-28-12)