Natural Gas Price Analysis – Natural Gas Bounces to Start Week

Natural Gas Technical Analysis

The natural gas market was very bullish in the early hours here on Monday as we continue to see a lot of questions asked about the overall trajectory. At this point in time, I default back to the idea that we are in the so-called shoulder season, which is between high demand.

In the wintertime, there is a huge amount of demand for heating, while in summer, of course, it is occasionally hot enough that we have massive electric demand and therefore it relates to cooling, such as air conditioning. That being said, it is a market that, at this time of year, anytime it rallies, I start to look for shorting opportunities. I believe signs of exhaustion are those opportunities, and I’m more than willing to take advantage of them.

Signs of Exhaustion are Shorting Opportunities

The 50-day EMA sits right above the highs of the trading session, and the $3 level sits just above there. $3 of course is a large round psychologically significant figure that I think a lot of people will be watching and, in this environment, it is probably only a matter of time before any attempt to get there gets squashed.

Later this year, in the summertime, we will get the occasional heat wave in the United States, and that could very well send natural gas much higher. But until that happens, this remains a very bearish market from everything that I can see as storage is plentiful right now and quite frankly, demand just isn’t there.

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