Aug 232012

NG 09 12 (1 Min) 08.23.12

8/23/2012 Weekly Natural Gas Inventory Report (0430 HI time / 1030 EDT)
Forecast: 40B
Actual: 47B
Started @ 2.764
1st Peak @ 2.682 – 0431 (1 min)
82 ticks

Reversal to 2.730 – 0436 (6 min)
48 ticks

Notes: Larger than expected gain in supply from the forecast caused a fairly large short spike on the :31 bar. With JOBB, after 20-25 ticks of slippage, you would still have an opportunity for 25-35 ticks of profit when it hovered at the 2.702 area. The market was already trending lower, so all 3 major SMAs were above the trade action. The spike only crossed the S2 Pivot about halfway down its descent. 2.682 was a low tested on 8/16 and a firm area of support with no trading below the level happening since late June. The reversal gained 48 ticks in 5 min to find resistance in the area of the S2 Pivot. There is no clear opportunity for a secondary trade on this report, so play it safe and sit it out. After the reversal, the market did not stray too far from the area of the S2 Pivot, encountering resistance when the SMAs trended lower and support at the 2.720 area.