After a very weak session for most of the commodities complex, Nymex Natural Gas futures bucked the trend and broke from the short term Channel Up pattern highlighted in yesterday’s update, as well as resistance presented by a much larger and longer term Falling Wedge chart pattern. The Falling Wedge pattern is illustrated here on the 240-minute time frame, with the breakout and projected price spike. This key reversal in the market across multiple time frames increases confidence in the strength of the breakout, with a significant upside potential provided in the forecast. The breach of the Falling Wedge resistance at $4.29 per million BTU’s came on very strong momentum and a solid close near the highs of the day. A continuation of this rally could achieve the initial minimum target 6.6737 to complete the pattern, as well as run to the upper end of the zone at $5.1669 to set new highs for the year. A close back below the $4.29 breakout level would negate the bullish pattern, however the current strength of the market combined with the very orderly technical breakout from this clear pattern will likely drive speculative buying for Tuesday’s session and perhaps well beyond.

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