Natural gas markets were choppy again on Monday, as we continue to dance around the $2.75 level. The market will probably continue to see volatility as there are a lot of moving parts in the natural gas markets. Longer-term, we always have the oversupply hanging over the market, and I think that there is no way that we are going to get a longer-term buy-and-hold type of scenario. Because of this, I am a seller rallies, believe that we will go down to the $2.75 level, breaking below there to go to the $2.65 level and then eventually the $2.50 level. Natural gas is by far the market that I am the most bearish of, and realize that the United States alone has over 300 years’ worth of natural gas proven reserves in the ground.
Selling short-term rallies
On signs of exhaustion, I believe it all short-term rallies are selling opportunities, as the natural gas markets look a lot like the Gold markets did in the 1980s: a cell on the rallies type of event.