Aug Natural Gas:Natural gas fell sharply on Thursday on a reversal triggered but the EIA report which came out in line with expectations at +60 Bcf. Prices settled just below the 4400 mark at 4395, down 10.5 cents on the day. Current daily chart has the price between the 20-MA at 4350 and key Resistance area at 4425-4455 setting a Mixed bias with the downside vulnerable until 4455 can be regained.

Sellers can initially look to short the 4425-4455 R1 Resistance zone with Stops above 4470 suggested, then take a mild scalping approach against 4500 R2 Resistance, Stops above 4515 suggested. Failures to trade above 4455 should keep the action on the defensive, retesting 4373-4350 S1 Support (Thurs Low/20-MA). Trade below 4350 renews weakness and sets off the next leg down to 4300 S2 and overall targeting last week's swing low at 4250 S3 Support.

On the upside, buyers can look for a retest and hold of 4373-4350 S1 Support for buying opps. Using Stops below 4335. All longs should scale out at 4425-4455 R1 and 4500 R2 Resistance targets. Trade above 4500 looks to rekindle the Bulls and potentially sparks rallies back to the weekly highs at 4594-4610 R3 Resistance target.

Daily Chart:

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