Natural Gas Price Analysis for April 24, 2017

Natural gas prices dropped sharply on Friday despite weather that will likely drip cooling demand in the east coast and heating demand in the mid-west and west.  Prices slid through support near the April lows at 3.114, and closed the week trading near 3.10, slightly off the 3.082 lows.  Prices continue to form a head and shoulder pattern which is a reversal pattern, which usually comes at the end of a uptrend.   Price action is forming the right shoulder with the neckline seen near the February lows at 2.75.  A break of this level could lead to a test of the 2016 lows at 2.35.

Momentum Remains Negative

Momentum has recently turned negative as the MACD (moving average convergence divergence) index recently generated a crossover sell signal. The index is now printing in the red with a downward sloping trajectory which points to lower prices for natural gas.