Table Summary

This table illustrates three significant points about Natural Gas price movement characteristics:

1. Impulsive swings tend to be longer than the overall average swings.
2. Corrective swings tend to be shorter than the overall average swings.
3. At the present time, as depicted in the current primary swing chart, Natural Gas swings are:
   • The Major level swing appears to be in an up swing. The critical issue is whether this up swing will be an impulsive or a corrective swing.
   • At the risk of being premature, the Intermediate level swing appears to be in a corrective down swing. The alternate view presently shows the same.
   • The Minor level swing appears to be in an impulsive down swing within the context of the Intermediate corrective level down swing. The alternate view presently shows the same.
   • The Minute level swing appears to be nearing the end of a corrective up swing and beginning the last impulsive down swing within the context of the Intermediate level corrective down swing. The alternate view presently shows the same.

However, because of space, this table does not illustrate several other equally significant aspects of Natural Gas price movement behavior which are useful in establishing price, time, and speed forecasts for the current swings depicted in the current swing chart:

1. Impulsive swings that occur within the context of an impulsive swing at the next higher swing level tend to be longer and, on many occasions, exhibit faster speeds than impulsive swings that occur within the context of a corrective swing at the next higher swing level.
2. An impulsive swing can be the only swing within the next higher swing level or it can be the first, middle, or last swing. Each type of impulsive swing tends to exhibit its own unique price movement characteristics (price range, time, and speed).
3. The price range, time, and speed of the previous swings are known. We also know the historical price range, time and speed ratios for each historical swing relative to its previous opposite swing and previous similar swing. Given these two known elements, we can forecast the price range, time and speed of the current swing for each level.

Swing Point Characteristics

Given that we appear to have achieved a High Swing Point (HSP) window for the Major swing level, over the next week we will be filling in the following sections to describe the characteristics that tend to accompany Major level down swings:

Duration

See Current Primary Swing chart and Current Alternate Swing chart.

Speed

See Current Primary Swing chart and Current Alternate Swing chart.

Commitment Of Traders Reports

Large Traders

Commercial Hedgers

Small Traders

Volume

Momentum

On-Balance Volatility

AGA Reports

Reaction to Surprises

Surprises tend to move prices in the direction of the underlying bias (i.e. the direction of the Major level swing):

Additionally, when surprises do occur and prices do not move impulsively in the direction of the perceived underlying bias, the perceived underlying bias is probably wrong and/or the underlying bias is changing direction.

Suitable Strategies & Tactics

Pages are being developed that incorporate the application of the foregoing to the unique characteristics of natural gas producers, end-users, marketers, traders, and speculators. Please review, even as the pages are being developed. Your feedback would be helpful in shaping the form and substance of the pages.

Other Issues

To aid in utilizing the foregoing, you will find a written description of Profiling Swing Characteristics in the Analytic Framework page.

Please feel free to email me or utilize the comments button to initiate a dialog regarding the foregoing comments and issues related to the Intermediate, Minor, and Minute level swing price, time, and speed forecasts.