Natural Gas Price Analysis – Nat Gas Stalls at $2.85 as 50 EMA Caps Rally

Natural Gas

The natural gas market has been somewhat negative during the trading session on Thursday in the early hours, as the $2.85 level resistance barrier has held. Ultimately, during the Wednesday session, we did see a spike towards the 50-day EMA that got turned back around.

We are still trading the September contract, but we are not too far from trading the October contract, and that is something to keep your eye on. The October contract should start to focus more on autumn, temperatures dropping, and generally speaking, the seasonality of this market comes into play.

Storage Glut and Overhead Resistance

We have a glut of natural gas storage at the moment, though, and that is a bit of a problem for traders overall.

The natural gas market is also watching the Middle East, and whether or not there are going to need to be mass amounts of exports coming out of the United States to fulfill European demand this year. That’s a story for the next couple of months. It’s still not quite there yet, but definitely something that’s on my radar.

Technically speaking, we are consolidating. That’s fine. That’s what this market tends to do most of the time. It’s actually a pretty stable market, 80% of the time from what I have experienced.

The 50-day EMA above offers a bit of a barrier. If we were to break above there, I’ll be looking for $3, but I still like the idea of fading on the first signs of weakness this time of year. We’re not quite to the point where I get to be bullish.