Natural Gas Price Analysis – Natural Gas Drifts Sideways Early on Wednesday

Natural Gas Technical Analysis

Natural gas was very quiet in early trading on Wednesday as we continue to look at the 50-day EMA above as a major barrier, followed by the $3 level. The $3 level of the course is a large, psychologically significant figure that will attract a lot of attention, probably a lot of options traders as well.

We are in shoulder season, meaning that the demand is not good and therefore any time this market rallies I look to sell it. I did that just a couple of days ago, probably not looking for much here. This is a very quiet time of the year to say the least.

Market Outlook and Resistance Levels

Natural gas, quite frankly, is a market that only has 2 short active times of the year, generally speaking, but right now, what I look for is signs of exhaustion after short-term rallies to take advantage of the fact that it is so bearish.

The $2.55 level I think is the target again and even if we did break above the $3 level, I think the 200-day EMA near the $3.30 level would be an even deeper amount of selling pressure. This will continue to be an area that we will have to watch closely.

Honestly, I don’t think we can get there without some type of external pressure coming into the market that extends beyond anything remotely normal. I know there is a war in the Middle East, and it doesn’t matter. This is a US contract, so you need to pay attention to US demand.

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