Natural gas markets spend most of the day sideways on Friday

Natural gas markets did very little during the day on Friday, as we continue to catch her breath after a couple of significant moves. Beyond that, it should be noted that we have broken back above the top of the daily uptrend in channel, so it suggests to me that we are going to continue to try to fight to the upside. The $3.00 level above is significant resistance, extending to the $3.10 level after that. I think that the market is short-term bullish, but I think it’s also only a matter of time before the sellers will come back and short this market. After all, this is a market that continues to be driven by short-term fundamentals more than anything else. In other words, daily weather reports coming out of the United States.

Longer-term, I do think that the sellers come back after short-term burst, so I think in the short term we will probably continue to see buyers try to push, but I much more comfortable selling closer to the $3.00 level as it has been significant resistance more than once. The $2.80 level underneath is massive support, so I think that it should continue to hold the market. In other words, expect a lot of volatility and if we go too far in any one direction, you should start thinking about reversing the trade. Temperatures in the United States will continue to drive where the market goes next, but in the longer-term we have a massive amount of oversupply when it comes to this commodity in general.

NATGAS Video 04.06.18