Energy OverView March 5, 2013

Yesterday, natural gas prices posted an outside day with a higher close, which a key bullish signal. There is also a discernible rising wedge pattern, and the move above 3.55 represents a breakout above the recent extended range defined by 3.40 and 3.55. Given the bullish factors at work for the chart, prices are now likely to carry all the way to the January high of 3.65. There is some mild resistance at 3.60. On the downside, support is seen at 3.442, the 13-day EMA, and further support is seen at the bottom of the recent range at 3.40. A break of 3.40 would usher in a rapid sell-off, but that appears unlikely at the moment.