National Gas Forecast November 23, 2015, Technical Analysis

The natural gas markets fell during the session on Friday, breaking down below the $2.40 level. Because of this, it appears that the market is ready to continue going lower, and as a result we should see this market reaching down towards the $2.25 handle soon. We believe that rallies are selling opportunities going forward, and as a result we will treat them as such. We have no interest whatsoever in buying, because quite frankly the natural gas markets are beyond soft at this point in time. There is a very serious lack of demand out there, and at the same time you can have the US dollar rising in value. In other words, it takes a lot less currency to buy this particular commodity at this point in time.

Looking above, the $2.40 level should now be resistive, so any type of resistant candle in that general vicinity has us selling again. We believe that a break down below the bottom of the range during the session on Friday since this market looking lower, reaching towards the $2.00 level over the longer term. We believe that every time there’s a rally, people will be looking to sell yet again, so we feel that it’s the only way to trade this market. True, we are oversold but we’ve also seen quite a bit of consolidation here recently. That gives us the momentum to continue going lower, and quite frankly at this point in time were not even sure that the $2 level is going to end up holding the market up.

Keep in mind that the supply of natural gas in the United States and Canada alone is astronomical now, and that of course will continue to put serious pressure on price when it comes to this particular commodity, and with this we believe that the market will be much like the gold market in the 1980s, simply one that you can sell again and again, and with very little in the idea of the bottom below. With this, natural gas is one of her favorite markets to sell.