Natural Gas Price Forecast: Bearish Pressure Intensifies, Bounce Possible

Bearish Engulfing Pattern and Trend Breakdown

Natural gas is on track to complete a one-week bearish engulfing pattern with a close below last week’s low of $2.92. This follows the breakdown of long-term trend support last week, as an uptrend line and prior swing low at $3.01 were broken. The trendline is at the bottom of a large rising trend channel, giving the breakdown potentially greater significance. This week’s bearish price action confirmed the bearish implications of the failure of long-term support. Moreover, this week’s high of $2.35 successfully tested resistance near the long-term uptrend line before sellers took control to a new corrective low.

Support Levels and Monthly Lows

Support for the week was seen at an interim swing low of $2.77, which is also a higher monthly low. A sustained decline below this week’s low would trigger a breakdown from monthly support. That would put natural gas in a position to test and likely break below a higher swing low and monthly low at $2.62 from August.

Potential for Bullish Reversal

Despite the continued bearish indications, natural gas is also sitting in an area that could sustain support and lead to a bullish reversal. It has formed a small, potentially bullish falling wedge during recent price action. However, the pattern is not definitive, and it could evolve into a different pattern altogether. While the corrective low of $2.78 is nearby, there is also a potential support zone near the prior downtrend line marking the top boundary of a large falling wedge that triggered to the upside in October.

Depth of Bearish Correction

There is also the possibility that the bearish correction has extended too far to the downside without a meaningful countertrend rally. As of this week’s low, the price of natural gas had declined by 62.7% from the January $7.44 peak. That clearly exceeds the two larger bearish corrections that followed the 2024 low. The first in 2024 saw a 40.65% decline in price, while a 46.5% drop ended a correction that began following the March 2025 top.

Conditions for a Bullish Reversal

Given the current configuration on the chart, a bullish reversal would not be indicated until there is a sustained advance above the most recent lower swing high at $3.25. Since that high is also a weekly high, a recovery would be bullish on both the daily and weekly charts. Nearby is the falling 20-day moving average at $3.20. It will take on greater significance as dynamic resistance if price approaches and tests $3.25.

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