Bullish Momentum Builds as Natural Gas Targets Key Resistance Levels

Natural Gas Forecast Video for 17.05.23 by Bruce Powers

Natural gas progresses higher to reach a daily high of 2.47 before selling pressure took it back down. It is now on track to close near the low of the day. At the high of the day natural gas completed an 88.6% Fibonacci retracement and a 127.2% Fibonacci projection of a small ABCD pattern (not marked on chart).

Swing High Breakout Needed for Bull Trend Continuation

That high is just shy of the recent swing high of 2.53 (B). A daily close above that high will trigger a bullish trend continuation and opens the door to higher prices. Today, natural gas made a serious attempt at breaching that swing high. A retracement to 88.6% level shows strength. In addition, this will be the second day that natural gas closes above the 34-Day EMA. Three daily closes above the line will be a change in the existing pattern of a maximum of two daily closes above the 34-Day line. One more, and the pattern is changed. It would be a sign of strengthening if it were to occur.

Monthly Candle Setting Up

The 2.53 high is also a monthly high. Monthly triggers are more significant than those from a shorter time frame. A daily close above the monthly high confirms strength. A continuation of the uptrend should therefore continue once this target is met. It could be the beginning of natural gas moving into a clear completion of the bottoming formation that has been forming for the past few months.

Further, the monthly candle is taking the form of a bullish monthly hammer candlestick pattern. Of course, the month is not over so the candle can change. Nevertheless, if it ends the month in the top third of the months range, it will be a bullish occurrence.

Upside Target Lies Near Downtrend Line and 200-Day EMA at 4.05

The highest current upside target for natural gas is around potential resistance of the downtrend line and 200-Day EMA (blue). They are converging with each other identifying a similar price area. The 200-Day line is now at 4.05. Interim lower targets are marked on the chart by a combination of Fibonacci confluence, prior price structure, and targets from an ABCD and measured move patterns.

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