Natural Gas Price Forecast: Bears Target January Low

Short-Term Weakness Signals Bearish Pressure

Natural gas showed signs of weakening on Monday as it broke below a short-term uptrend line and last week’s low, reaching a four-week low of $2.86. The bearish signal will confirm with a daily close below $2.89. This demonstrates sellers taking greater control, which puts the January low of $2.58 at risk of being tested. Before that occurs, the interim higher swing low at $2.81 must fail as support.

Bearish Consolidation Dominates

Monday’s bearish continuation signal suggests that the downtrend remains dominant, and it may be ready to reassert itself. Natural gas has been consolidating in a relatively bearish position below a long-term uptrend line, under a downtrend line, and below the 200-day moving average, now at $3.54. Price compression is evident as two trendlines converge, forming a symmetrical triangle consolidation environment. Once resolved, with a breakout through one of those lines, momentum is anticipated to improve. Unless Monday’s breakdown fails, the market appears poised for bearish continuation.

Critical Support Zones to Watch

If the February interim swing low at $2.81 fails as support, a bearish continuation signal will occur. There was a higher swing low at $2.74 from August where temporary support may be observed, but another decline through that level could lead to a new trend low, below the January trend low at $2.58. A trend reversal signal was generated initially when natural gas fell below the August low in January. Although it has not yet fully followed through, it is more likely to do so if the $2.74 support zone is broken for a second time.

Resistance Limits Potential Rallies

Downward pressure will remain until there is a rally above the interim swing low at $3.24 from last Thursday. Even if the rally occurs, advances face key resistance near the lower swing high at $3.49 and the 200-day moving average at $3.54, linking back to the initial bearish context. This shows that while temporary support zones exist, the overall momentum remains biased to the downside unless these resistance levels are decisively broken.

If you’d like to know more about how to trade natural gas, please visit our educational area.