Natural Gas Price Eyes $3 as October Rollover Approaches

Natural Gas Technical Analysis

The natural gas market has rallied a bit during the early hours here on Wednesday, as we are now threatening the 50-day EMA. This is a market that has a lot of moving pieces, not the least of which right now that tomorrow we start to roll over into the October contract. The October contract will, generally speaking, be much more kind to natural gas than September, as we at least have a chance of cooler weather later in the month. As we stand right now, there is a massive amount of supply in the United States, and the demand just isn’t going to be enough to get the market really rolling at this time, but is coming.

October Rollover and 50-Day EMA Resistance

Breaking above the 50-day EMA opens up the possibility of a move to the $3 level, as it was a swing high. One would think that traders will look at that as a potential target or barrier, depending on what side of the equation they’re on. This could continue to be the big fight that the market has.

I still think that we are a little bit early for the seasonality, but things will typically start to get a little bit better this time of year for natural gas. So, I’m starting to shift from bearish for a couple of months to more neutral now and then will slide over into a bullish tone. Right now, I’m fairly neutral, so I’m thinking more range-bound than anything else when it comes to natural gas markets at this point.

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