Natural Gas Price Analysis – Natural Gas Rises After Qatari Damage

NATGAS Technical Analysis

The natural gas market gapped higher to kick off the trading session on Thursday but did give back a bit of those gains. Keep in mind that we got reports during the overnight session that Qatar has seen its natural gas infrastructure attacked again and there is more damage. If that’s the way things go, it means Europe will find itself buying US gas before it is all said and done – or deal with Russia.

So with this being the case, I think we have got a situation where traders are going to continue to look at this as a 2-speed market in the sense that when we do pull back enough, you probably have to think a certain amount of buyers will be out there due to the fact that the Europeans are probably going to have to continue to import US natural gas.

On the other hand, it is a pretty low time of year as far as demand is concerned. So, I still think we have a bit of a ceiling in this market somewhere near the $3.50 level. Ultimately, I like fading rallies. I just think it is easier at this juncture and if we do break below the $3 level, we could go looking to the $2.80 level which has been supported as well. I am bearish on natural gas, but it is not as bearish as I would be under normal circumstances due to the damage in Qatar. Because of this, I would expect choppy behavior overall, but with a decidedly bearish overhang at the moment.

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