Sep 272012

NG 11 12 (1 Min) 09.27.12

9/27/2012 Weekly Natural Gas Inventory Report (0430 HI time / 1030 EDT)
Forecast: 75B
Actual: 80B
Started @ 3.264
1st Peak @ 3.247 – 0431 (1 min)
17 ticks

Reversal to 3.280 – 0432 (2 min)
33 ticks

2nd Peak @ 3.210 – 0449 (19 min)
54 ticks

Reversal to 3.249 – 0501 (31 min)
39 ticks

Notes: Nearly matching report with a large gain in supply caused a relatively dull reaction for the NG. After some initial noise, it drifted lower for 17 ticks, sitting on the R1 at the origin, then crossing the 100 and 200 SMAs on the short move. It retreated and left the entire tail naked, finishing where it started. With JOBB, you would have filled short on the spike with no slippage at about 3.254. Then you would have an opportunity to close out with about 2-3 ticks where it hovered before retreating upward. The reversal quickly recovered above the 50 SMA and the R1 Pivot for 33 ticks, then fell into the 2nd peak. The 2nd peak took 3 steps as it ratcheted lower for 54 ticks. With a near matching report, tame initial reaction, and the SMAs surrounding the action at the beginning, I would not be inclined to take a manual trade on this report. However, selling a rip on the :32 bar with a stop above the HOD at 3.290 would have been a safe play. Keep an eye on it as it crosses the 100 and 200 SMAs on the :33 and :34 bars (no large support influence), and closeout after the :34 bar.