Natural Gas Markets Continue Topping Pattern

Natural gas markets have rallied a bit during the trading session on Tuesday as we continue to see a lot of back and forth behavior. That being said, the $4.50 level seems to be a bit of a magnet for the price of gas, as the natural gas markets will continue to weigh the idea of potential problems with Gazprom in Europe, but at the same time has to take into the fact that the temperatures in the United States are starting to rise. As long as that is going to be the case, the natural gas markets are a market that I am ready to short going forward at the first signs of exhaustion.

NATGAS Video 02.03.22

The 50 day EMA underneath sits at the $4.30 level, so I think there might be a little bit of support there, but it probably will not be very stringent. After all, we are going to see demand fall through the floor and therefore I think it makes sense that we see prices going lower. It appears that the $5.00 level is going to be a short-term ceiling, and therefore I would be a bit surprised if we rallied above it. On the downside, I believe that the $4.00 level could be a bit of a target as well as support. Breaking below that level could then have the market looking towards the $3.50 level. In general, this is a market that I think is going to continue to be noisy, but the overall fundamentals are more bearish than they are bullish at this point.

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