Natural gas markets explode to the upside and into resistance on Thursday

Natural gas markets continue to be very noisy and have shot straight to the upside as we had seen plenty of momentum in the market going higher. I believe that the market will roll over a bit, as we are starting to show signs of exhaustion near the $2.95 level. I think there is a significant amount of resistance extending to the $3.00 level as well, so I think it’s only a matter time before the sellers get involved. I would start out slow, and then perhaps trying to build a position as I believe longer-term natural gas will continue to struggle. Milder temperatures in the United States could drive down demand as well, and we did get quite a bit of a build later in the day.

If we were to break down, I think that the market will go looking towards the $2.85 level as a target, and then I think that the market could turn around and go higher again, only to find sellers again. I think $2.80 would of course be an even bigger target, and perhaps even a longer-term target. I think that the next several sessions ago to be very difficult as we start to talk about tariffs between the Americans, Canadians, Mexicans, and the Europeans. This throws the markets into complete disarray, and quite frankly at this point I think a lot of people don’t really know what to do. Because of this, the volatility is probably the one thing you can count on, not just the natural gas markets, but everywhere else as well.

NATGAS Video 01.06.18