Natural Gas Markets Bounce From 200 Day EMA

Natural gas markets have fallen significantly during the course of the trading session on Friday, to reach down towards the 200 day EMA. By doing so, the market looks as if it is trying to hang onto some bullish pressure, but quite frankly at this point in time I think the last couple of sessions have shown you just how weak the buyers are. If we rally for any significant amount of time at this point, it is very likely that we will see this market find plenty of sellers.

NATGAS Video 17.01.22

Natural gas is getting a bit of a pop due to the cold temperatures in the northeastern part of the United States, but that is a temporary phenomenon. At this point in time, any time that this market rallies, I am looking for an opportunity to short it. On the other hand, if we break down below the 200 day EMA, then it is likely we go looking towards the gap underneath, finally filling it. Nonetheless, I have no interest in buying natural gas, and most certainly not at this time of year. Even if you told me that we were going to gain 5% in the next 24 hours, I would simply be looking for an opportunity to short the market.

All things being equal, this is a market that I think continues to see a lot of noisy behavior, but quite frankly we will eventually break down significantly at this point and I think that a lot of traders will be aiming for the $3.50 level underneath, perhaps even the $3.00 level after that as it is the “measured move” of the massive descending triangle above.

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