Natural Gas Continues Slide

January 12, 2006
Ashton Dorkins

TradingMarkets

Futures Pivots are now much easier to use and available for free. To use
them as part of your daily research, simply select the contract you are trading
and tomorrow’s support and resistance levels are displayed.

Thursday saw an action packed economic
calendar, starting in Europe where the BOE and ECB both left interest
rates unchanged — as expected. The US Trade Deficit came in lower than expected
(report),
Import Prices fell while Export Prices rose (report).
Initial Jobless Claims increased, but were still below forecasts
(report).

Treasuries rebounded from a sharp 2-day selloff that
pushed yields to a 3-week high yesterday. Today’s government offering came in
the form of $9 Bln TIPS.

The Euro fell versus the US Dollar after comments
made by ECB President Trichet cited risks to economic growth in Europe. Read
Dave Floyd’s latest analysis on the Dollar Index

here.

In the energies, Iran’s decision to break another
two UN seals from nuclear reactors and the kidnapping a four oil workers in
Nigeria raised worries that external forces may begin to play a role in the
price of oil and gasoline.

Nonetheless, Natural Gas
(Futures Pivots)
continued to decline, closing below $9 for the first
time since late July. Open interest has begun to decline over the past few days
as traders started to either roll into March 06 contracts or close positions.
Technically the market could stage at least a short-term rally so be alert for
any setups that may emerge.