Natural Gas Price Forecast August 15, 2017, Technical Analysis

Natural gas markets initially went higher as we gapped at the open on Monday. We broke above the $3 level, and then melted down from there. The market looks very bearish, as the resistance barrier between the $3.00 level and the $3.10 level has offered massive selling pressure. Because of this, the market looks likely to go much lower, and I am a seller of rallies. Longer-term, you guys know that I am very bearish and natural gas as we have far too much in the way of oversupply. If we can break down below the $2.85 level, the market should go much lower than that. I think that short-term rallies that show signs of exhaustion are going to be excellent selling opportunities, and I also believe that the gap that opened the day should offer resistance as well, which is particularly interesting for me as it is just below the $3.00 level.

If we break below $2.85

If we can break down below the $2.85 level, the market will probably go to the $2.75 level next, and then possibly even as low as $2.50 after that which of course is my longer-term target. I recognize that there is more than enough natural gas in the world, so I don’t think we are going to be worried about undersupplied anytime soon. Commodities tend to follow longer-term fundamentals, probably much better than currencies and stocks. There is simply too much natural gas to sustain any major rally for any real length of time for what I see. While there may be some parts of the world that struggle to have enough supply, the reality is that there is more than enough natural gas out there, it’s more of a shipping issue than anything else.

NATGAS Video 15.8.17