Natural Gas Outlook – Natural Gas Continues to See $4 as Barrier

Natural Gas Technical Analysis

The natural gas market gapped higher to kick off the trading session, which makes a certain amount of sense considering that the Americans bombed three nuclear sites in Iran over the weekend. And of course, people, the first instinct with them is going to be to start buying oil and gas. That being said, the market didn’t even bother going higher. It just fell from there and this to me signifies that the area right around the $4 level will be a massive barrier still.

If that’s the case, you pay attention to the massive shooting star on Friday, this tells me that we are now looking at this $3.85 region to see whether or not we can break below it. If we do, then the 50 day EMA is followed by the $3.50 level. Underneath there, then you have the 200 day EMA. Ultimately though, we could bounce on some type of negative headline as far as risk is concerned, whatever, but I still think that a lack of demand is going to be an issue sooner or later.

We’re in the midst of a heat wave here in the eastern part of the United States. And that of course has a certain amount of demand being shown in the market, but we’ve already seen that play out a bit. In fact, by the beginning of next week, temperatures should be closer to the norm. So, I still think the market is trying to get ahead of the next plunge and start selling.

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