Natural Gas Markets Attempt to Stabilize

Natural gas markets have rallied ever so slightly during the trading session on Thursday as we are trying to stabilize near the $4.50 level. Underneath, we have the 50 Day EMA hanging about the $4.40 level, and that probably will continue to attract a certain amount of attention. Because of this, I think that the market is trying to grind sideways and find its footing, perhaps for a short-term bounce. That being said, I do not like natural gas at all and have no interest whatsoever in buying it.

NATGAS Video 11.03.22

On the downside, if we were to break down below the 50 Day EMA, which again is at the $4.40 level, then I am more than willing to start shorting again. At that point, I would anticipate a move down to the 200 Day EMA, which is currently at the $4.18 level. This is an area that I think will attract a certain amount of attention, so a bounce from there would not be a huge surprise either. That being said, I think that it is only a matter of time before we do break down towards the $4.00 level, as demand will dry up due to temperatures rising in the northeastern part of the United States.

If there is some kind of cease-fire in Ukraine, that will also have a bit of a “knock-on effect” over here, sending natural gas prices much lower. This is kind of ironic, considering that not much natural gas gets exported to Europe from the United States, but it is what it is. With this, I do believe that any rally is to be sold into at the first signs of exhaustion.

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