Natural Gas Price Forecast: 61.8% Fib Tags $3.89 – 50-Day Breakdown Confirmed

Tuesday’s Continued Selling Pressure

Selling continued to dominate price action in natural gas on Tuesday, producing the seventh sequential day of lower daily highs and lows. Support emerged at the day’s low of $3.84 in direct response to the completion of a 61.8% Fibonacci retracement at $3.89. Sellers remain in control at writing, with natural gas likely to close in the lower quarter of the day’s range, reflecting persistent weakness despite the minor responsive buying.

50-Day Breakdown Fully Confirmed

The breakdown of the 50-day average confirmed Monday with a daily close below last week’s low of $4.07. Tuesday’s further decline solidified that selling pressure. Short-term resistance now resides at the 50-day line around $4.09, where traders will anticipate overhead supply and potential continuation lower. With the 50-day clearly violated, focus shifts to the 200-day average as the next meaningful downside objective.

200-Day Confluence as Magnet

The 200-day line sits currently at $3.58 and has recently converged with an uptrend line, adding potential significance as rising support. It also aligns with a horizontal price area around $3.59 where the October swing high and 2023 peak previously met resistance. This multi-factor confluence should act as a magnet pulling price lower before the current bear correction exhausts itself.

Channel and Historical Context

The long-term uptrend line forms the bottom of a trend channel. A breakdown occurred in August, followed by a bullish recovery in late-October when resistance at the trendline coincided with the 200-day average. The current setup could mirror that dynamic in reverse, with the convergence now offering support instead of resistance.

Monthly Reversal Implications

A monthly bearish reversal triggered last week, and this week’s price behavior is confirming the bearish implications. It supports the scenario of reaching the 200-day line before substantial support materializes and buyers begin returning in force. Watch this week’s closing price for additional clues on underlying demand dynamics.

Outlook

Natural gas has flipped decisively bearish with the confirmed 50-day breakdown and monthly reversal driving price toward the powerful 200-day/uptrend/horizontal confluence near $3.58. Temporary support near the 61.8% $3.89 may slow the decline, but momentum favors continuation lower until that deeper zone is tested; only a rapid reclaim of the 50-day would ease immediate downside pressure.

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