Bears own the battlefield, but bulls have a fortified bunker.

SCOUT BRIEFING PERIOD: Aug 7-11 & Aug 12-15 | WEEK 34 OUTLOOK

Data sources from: CME Group | EIA.gov. | Trading 212 | Investing.com | Prices in USD | CET | AI Tool

Technical Outlook for Week 34 (With Key Limitations)

This analysis focuses exclusively on price action, volume patterns, and EIA storage data – the core technical drivers of Natural Gas futures.

What’s Included:

• Critical support/resistance levels
• Volume-OI dynamics
• Important inflection points
• Institutional positioning clues

What’s Not Included (But Vital):

• ⚠️ Weather forecasts – The #1 driver of NatGas volatility
• ⚠️ Geopolitical supply shocks
• ⚠️ Unplanned LNG outages

Bulls dig in at “The Bunker” as Bears tighten the siege. With EIA storage looming and π signals flashing, this week decides whether we crash to $2.65 or stage a counterattack. The Aug 15 bear trap revealed their game – now it’s payback time. – No mercy. No middle ground. Just pure energy warfare

Weeks 32-33: After-Action Review – Here’s What Went Down

Like any good war room, we study yesterday’s battles before planning tomorrow’s strikes. No soldier advances without checking his six. Markets leave forensic evidence. We’re gathering all bullet casings:

Price Action Recap: Bulls vs Bears

Week 32 (Aug 7-11):

Opened at $3.099 with bullish hopes, but bears swiftly seized control. Prices crashed 7.3% by Friday, closing at $2.954 after breaking critical support at $3.000. The weekend session (Aug 10) gap-down to $2.894 exposed vulnerability.

• High: $3.148 (“Bull Trap Peak“)
• Low: $2.881 (“$3.000 Massacre“)
• Key Break: $3.000 support shattered

Takeaway:

• Started at $3.099, peaked at $3.148, but closed lower at $2.954 after a mid-week selloff.
• Key drop on Aug 8 ($2.990 close) followed by a gap down on Aug 10 (weekend session).
• Recovery attempt on Aug 11 but failed to hold above $3.00.

Week 33 (Aug 12-15):

Delivered a bearish knockout punch: Aug 12 plunged to $2.774 (new monthly low) on year’s highest volume (657k). Bulls staged a late rebound on Aug 15 (+2.6% to $2.916), fueled by short covering. Verdict: Bears dominate, but bulls show resilience near $2.764 support.

• High: $2.966 (“Dead Cat Bounce“)
• Low: $2.764 (“The Bunker“)
• Key Break: $2.850 support held

Takeaway:

• Sharp decline on Aug 12 ($2.808 close), testing $2.774 (new weekly low).
• Sideways consolidation Aug 13-14 ($2.764–$2.852 range).
• Strong rebound on Aug 15, closing at $2.916 (+2.6% from previous close).

Critical Levels: Support & Resistance

SUPPORT (Bulls Must Hold)

1. “The Bunker” ($2.764-2.774):

• Rebounded twice under bear bombardment
• Break = Bearish floodgate → $2.650
• Bulls’ Strength: ★★★★☆
• Bears’ Strength: ★★☆☆☆

2. “Trench Line” ($2.836-2.850):

• Bulls’ frontline (Aug 15 low/open)
• Break = Bears advance → Test “The Bunker”
• Bulls’ Strength: ★★☆☆☆
• Bears’ Strength: ★★★☆☆

RESISTANCE (Bulls Must Storm)

1. “Rebel Wall” ($2.916-2.954):

• Bullish momentum trigger
• Bears defend fiercely (failed Aug 15 breakout/Immediate hurdle)
• Bulls’ Strength: ★★☆☆☆
• Bears’ Strength: ★★★★☆

2. “Fortress $3.000” ($2.985-3.000):

• Bullish reversal signal
• Aug 12 high/psychological barrier): Break needed for trend reversal
• Bears’ command center
• Bulls’ Strength: ★☆☆☆☆
• Bears’ Strength: ★★★★★

3. “Bears’ Citadel” ($3.106-3.148):

• Untouched since massacre
• Bulls’ Strength: ☆☆☆☆☆
• Bears’ Strength: ★★★★★

Final Trench Assessment (overall strength)

• BULLS STRENGTH: ▰▰▰▱▱ (3/5) – Strong only at “The Bunker”.
• BEARS STRENGTH: ▰▰▰▰▱ (4/5) – Dominate resistance.

Volume & Open Interest (OI) Analysis

Before we advance, let’s scout the battlefield—here’s how volume and open interest reveal the real forces driving Natural Gas prices. Here’s a summary of week 32 and 33:

• Volume Surge on Aug 12 (657k): Largest volume day, accompanied by a sharp price drop— bearish sentiment.
• OI Increase (Aug 12-14): OI rose to 1.621M, suggesting new short positions.
• OI Drop on Aug 15 (-180k): Indicates short-covering rally as price rebounded.
• Weekend Session (Aug 9-10): Extremely low volume (4.81k), causing a gap down.

Details on What It Means & Week 34 Impact:

Combo	Mechanism	W32/33 Example	Week 34 Impact
Price↓ + OI↑	New Shorts Entering	Aug 12: Bears ambush at $2.774	Accelerated selling if repeats
Price↑ + OI↓	Short Covering	Aug 15: Artificial rally	Unsustainable bounce
Price↓ + OI↓	Longs Exiting	Not observed	Bearish climax signal
Price↑ + OI↑	New Bulls Entering	Not observed	Bullish reversal confirmation

New Shorts Entering: Bearish scenario, example; Aug 12: Drop to $2.774.

Short Covering: Bears retreat, likely a rally follows) example; Aug 15: Rally to $2.916.

Longs Exiting: Capitulation/Panic selling/Bearish.

New Bulls Entering: Real demand/Bullish.

Short Covering Explained: Bears buy back contracts to exit positions, creating “fake” rallies (like Aug 15). Bears buy back contracts to exit positions, fueling rallies without new buyers.

Note: For Classified Intel on volume and OI’s, proceed to our Field Manuals

EIA Storage Report: The Fundamental Anchor

Before plotting Week 34’s advance, we’re conducting a full recon mission on Weeks 32-33’s EIA storage data – the fundamental intel that moves entire battalions of Natural Gas contracts. Here’s a summary of what our scout spotted in Week 32 and 33:

• Week 32: +45 Bcf build (Bearish – 40% above 5-yr avg)
• Week 33: +38 Bcf build (Neutral → Structural oversupply intact)
• Week 34 Catalyst: Build >+40 Bcf = Bearish detonator

Market Psychology

Bearish Conviction: Aug 12’s volume surge (+48% vs. average) and OI spike confirmed new shorts entering.

Bullish Hope: Aug 15’s rally on declining volume (+ short-covering) suggests bears are fatigued, not bulls strong.

Volume Clues: Declining volume into rebound hints at weak follow-through. Also as mentioned earlier: OI Collapse (Aug 15): 180k drop is likely confirming short covering. Short-covering rally to $2.916, Dead Cat Bounce $2.966 (+2.6%), but volume lagged.

Highlights

The Aug 12 high-volume drop and Aug 15 low-volume rally suggest a short-covering bounce rather than strong bullish conviction. Traders should remain cautious.

The Bounce Signal:

A short-term low detected at $2.764 (Aug 12-13).

Aug 12:

Highest volume (657k) + Price Drop – Strong bearish momentum. Yet, OI increased, confirming new shorts rather than long liquidation.

Aug 15:

Despite lower volume, price rallied—possible short squeeze. OI dropped significantly, supporting the squeeze thesis.

The August 15 Bear Trap Explained and Why It Matters:

What Happened: Price rallied 2.6% to $2.916, luring bulls. Bulls celebrated “recovery”.

The Trap:

• Low volume (118k vs Aug 12’s 657k) 78% lower than Aug 12’s capitulation volume
• OI dropped 180k (proving short-covering, not new buyers)
• No resistance breaks: rejection at Resistance: Stalled below “Rebel Wall” ($2.954)

Why It Matters: Fake breakout to squeeze shorts – not organic demand.

The Evidence:

Price: ↑ 2.6% | Volume: ↓ 78% | OI: ↓ 180k

The Purpose:

• Force retail bulls into long positions
• Create fuel for next bear wave

Insight:

The rebound from $2.764 aligns with a cycle low. Holding $2.85 could trigger a run toward $2.95.

Price rebounded 4.1% despite: Bearish EIA storage data – Rising OI (new shorts). Interpretation: Technical oversold bounce – not fundamental strength.

Week 34 Outlook: Probabilities & Mechanics

Bears hold the high ground, but bulls have a secret weapon at “The Bunker”. Let’s look into the scenarios.

Bullish Case:

PATH: Hold $2.850 → Break “Rebel Wall” ($2.954) → Charge “Fortress $3.000”.

TRIGGERS:

• Momentum Surge (price bounces from $2.764 with rising volume + OI↑)
• EIA build <+30 Bcf
• Hurricane disruption or Heat Wave
• Close above $2.916 for 2 sessions

Bearish Case:

PATH: Reject at $2.916 → Breach “The Bunker” ($2.764-2.774)→ $2.650.

TRIGGERS:

• Failed Bounce (close <$2.764 + volume <150k)
• EIA build >+40 Bcf or no weather disruptions
• Price↓ + OI↑ (new shorts entering)

Final Thoughts

Bears remain in control of the natural gas market until prices can decisively reclaim the $3.000 level. The recent bounce appears to be a technical correction within an overall downtrend rather than a true reversal.

This analysis focuses on Technicals and EIA data, but weather remains the wildcard for Natural Gas. Natural Gas is hyper-sensitive to weather shifts (heat waves/cold snaps) and a single forecast change can override all technical levels. Momentum can flip violently.

Last Intel: The Aug 15 trap was classic bear warfare – a low-volume squeeze to liquidate shorts and trap bulls. Until $3.000 falls, every rally is a sniper’s alley. Yet, we have to keep in mind that a single weather forecast change can override all technical levels.

Bottom Line:

Trade the chart… but always monitor: 🔹 NOAA forecasts 🔹 Storage vs. weather demand 🔹 Early winter pattern signals

Technical setups work until weather breaks them.

Disclaimer: These are Scouting Reports, not trade coordinates. Your capital is your platoon—lead it wisely. We’re not your CO (financial commander).

Disclaimer:

This content is for informational and educational purposes only and should not be construed as financial, investment, or trading advice. Always conduct your own research and consult a licensed financial advisor before making any investment decisions. Past performance is not indicative of future results. Trading and investing involve substantial risk, including the potential loss of capital. The author(s) and publisher(s) are not responsible for any losses or damages resulting from reliance on this information.