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Natural gas markets initially tried to rally during the trading session on Tuesday but ran into a lot of trouble at the $2.96 level. This is an area that has been a major resistance barrier over the longer-term, and it extends to the $3.00 level. As we approached this area, we rolled over rather drastically and rapidly, and in just a few short hours, we had dropped over a nickel. At this point, we are testing the $2.90 level, an area that has been important more than once. However, I also recognize that it is a minor support and resistance level, and that it makes more sense for this market to go looking towards the $2.85 level below, as it has been supported in the overall region.
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