Natural Gas Futures (NG) Technical Analysis – Sustained Move Over $3.306 Could Spike Market into $3.384 to $3.409

Natural gas futures reversed early weakness on Friday to finish higher for the session. The volatile shift in direction was fueled by another change in the weather forecast at the mid-session. Weather models remain inconclusive ahead of next week which suggests we’re likely to see more volatility and a possible two-sided trade.

On Friday, December Natural Gas futures settled at $3.309, up $0.59 or +1.78%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. However, momentum has shifted to the downside. A trade through $3.202 will change the main trend to down with $3.161 the next target.

A trade through $3.384 will signal a resumption of the uptrend. A move through $3.409 will reaffirm the uptrend.

The minor trend is down. This is why momentum is moving lower. A trade through $3.219 will indicate the selling is getting stronger. Momentum shifts back to the upside on a trade through $3.384.

The short-term range is $3.409 to $3.202. Its 50% level or pivot at 3.306 is controlling the direction of the market.

The intermediate range is $3.047 to $3.409. Its retracement zone at $3.228 to $3.185 provided support on October 12 at $3.202 and on Friday at $3.219.

The main range is $2.840 to $3.409. Its retracement zone at $3.125 to $3.057 is the primary downside target.

Daily Swing Chart Technical Forecast

Based on Friday’s close at $3.309, the direction of the December Natural Gas futures contract is likely to be determined by trader reaction to the pivot at $3.306.

A sustained move over $3.306 will indicate the presence of buyers. If this creates enough upside momentum then look for buyers to make a run at $3.384 then $3.409.

A sustained move under $3.306 will signal the presence of sellers. This could generate the downside momentum needed to challenge the 50% level at $3.228.

A move through $3.228 will indicate the selling is getting stronger with the next target a main bottom at $3.202, followed by a Fibonacci level at $3.185 and another main bottom at $3.161.

The bottom at $3.161 is the last support before the main retracement zone at $3.125 to $3.057.